Rumours of massive oil find follow Cameron’s secret Shetland visit

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Sunday, 03 August 2014 19:20

32 Comments

By G.A.Ponsonby

Rumours of a massive oil find to the west of Shetland are growing after Prime Minister David Cameron made a secret visit to the islands just under two weeks ago.

On July 22nd Mr Cameron turned up in Shetland unannounced. At the airport the Prime Minister was accompanied by the Secretary of State for Scotland Alistair Carmichael.

The secret visit, the first by a serving UK Prime Minister for 34 years, angered national media who were unable to despatch journalists to Shetland in time. Commenting on the visit, Scottish Secretary Carmichael told a local newspaper that the visit was, “the closest to a secret I’ve known in Shetland”.

However, suspicions were aroused when, within days of the visit, BP announced that the start-up of the Clair Ridge twin-bridge oilfield had been delayed by one year. However the delay was said to be due to the amount of work being carried out by the South Korean fabricator.

The Clair field is located 75 km West of Shetland – Clair Ridge is the second phase of the Clair Field development. BP has invested £4.5 billion in the Clair Ridge Project and expects to extract 640 million barrels of recoverable oil, and see up to 120 thousand barrels per day at peak.

Estimates put the total amount of oil at 7 billion barrels equivalent.

One week before Mr Cameron’s visit, industry specialists Synectics announced it had designed and delivered an end-to-end surveillance solution for Clair Ridge. The new technolocy is expected to result in more than 40 million additional barrels being cost-effectively recovered over the lifetime of the field.

Oil reserves known to exist around the Shetland waters have never been extracted due to the difficulties in getting to the reserves. However advances in technology coupled with high oil prices have now made the reserves economic to extract.

The Clair Ridge project will include the world’s first offshore full field deployment of LoSal enhanced oil recovery technology to modify the salinity of water injected into the reservoir and increase the recovery of oil.

This weekend rumours spread that workers on a rig in the Clair field had been sent home on full pay and told not to return until late September, coincidentally after the independence referendum.

An unnamed worker believed to be from the rig in question is said to have revealed that the amount of recoverable oil exceeds initial estimates and that the Clair could in fact be one of the biggest in the world. There are also claims that the quality of the oil discovered is much better than usual for the north sea.

The story was broken on Friday by online site Yes International. According to the outlet ‘contractors working for BP were stood down after obtaining the results of the latest test drilling statistics.’

It added: ‘It was said that the test results [for Clair] “far exceeded expectations”.

‘We have had other information that contractors have in fact been sent home on full pay just after receiving these results and that they were advised that they would not be recalled until after the referendum.’

Yes International revealed that Downing Street had refused to answer any questions but that BP had confirmed “We intend to invest billions in the area in the coming years”.

The rig believed to be involved is the Paul B Loyd Jr which was recently transported to the Clair Ridge sector. According to the offshore industry tracker Rigzone, the status of the rig is currently ‘drilling’.

Industry magazine Upstream said of Clair Ridge: ‘positive signals are emerging from an ongoing appraisal drilling campaign.’

Speaking at a press briefing days ago, BP chief executive Bob Dudley said: “We remain very enthusiastic about Clair Ridge – appraisal wells are looking good. It is helping us to define the structure out there.

“[Clair Ridge] will be a project once we get it on in the next few years that has the potential to produce until 2050.”

If the rumours of a massive find are true, then the Clair will become the second field to the west of Shetland to exceed expectations.

In June this year it emerged that the Lancaster field had also produced results that were greater than initial estimates.

Hurricane Energy, the company behind the find, said production tests using a pump achieved a flow rate of 9,800 barrels of oil per day, well above expectations.

“I am delighted to report the successful completion of our testing operations which have achieved hydrocarbon flow rates in the upper range of our pre-drill estimates,” said chief executive Robert Trice in a statement.

The Lancaster field is believed to hold a fifth of the North Sea’s total untapped oil and gas resource.

Newsnet Scoland have asked questions of the Scotland Office and BP. Any significant information received will be reported.

[Newsnet comment: The issue of North Sea Oil has been at the centre of the independence debate for decades. In 2005 a secret report emerged that revealed successive Westminster Government’s had withheld the true value of North Sea oil from the Scottish people.

In 1974 the UK Government commissioned a report into the potential of North Sea Oil and how it might influence support for Scottish independence. The report made clear that an independent Scotland would be far richer than if it remained within the Union.

The report’s conclusions were so dangerous that it was designated secret and hidden for thirty years before a Freedom of Information request forced the UK Government to reveal its contents.

Newsnet Scotland copied the entire report, together with an introductory letter written in 1975 by its author Gavin McCrone, and published it – it can be read here.

Publication of the McCrone report by Newsnet Scotland followed an admission by former Labour Chancellor Denis Healey that the Labour Government of the 1970s deliberately hid the true value of Scottish oil in order to thwart support for the SNP.

Newsnet Scotland published a short video – narrated by actor David Hayman – which summarised the report’s conclusions. It is reproduced below.

Comments  

 

# Brodie 2014-08-03 20:37

O/T –
Daily Record poll on who will win Salmond v. Darling STV debate:

dailyrecord.co.uk/…/…

 

 

# Virgil 2014-08-03 20:46

This is just a ridiculous story.

BP do not run their exploration and drilling activities from the Shetlands. They are run from Dyce. I can think of no oil company that does this.

The mundane fact of life is that Clair Ridge is at least 1 year late (which, incidentally, means there is no chance whatsoever of UKCS oil production increasing this side of 2017). As well as the rig crews, BP are seeking to redeploy their ops teams for the year as there is no work for them to do.

 

 

# crapdriver 2014-08-04 13:13

HUR shares down 3% (1.25p) today at midday in quite high volume trading considering this is an AIM stock, so the markets aren’t buying into any ‘conspiracy’ theories.

While I’m not an energy stocks expert, (echoing Virgil here) the Jul 3 announcement from HUR that “The group said it expects to make a further announcement by the end of the third quarter, once it has completed the technical analysis of the results.” seems to indicate that the reassignment of rig staff at this time is entirely consistent with a completion of this phase of exploration being completed.

One doesn’t need to invoke conspiracy theories to explain why Dave Camoron and the SoS made a personal visit evidently without announcing it in advance to the msm. They just desperate to keep attention away the fact that potential oil reserves are likely to be far larger than currently estimated.

 

 

# cynicalHighlander 2014-08-03 20:47

More info in pdf format: tinyurl.com/nko63dh

HT BtP on Wings.

 

 

# Marian 2014-08-03 22:25

I have seen at first hand an inordinate amount of oil exploration activity going on west of Shetland at this time coupled with two massive investment projects going on at Sullom Voe costing nearly two £billion.

There’s no way this would be happening if there wasn’t a massive amount of oil still to be extracted.

 

 

# RTP 2014-08-03 22:47

Speaking about Cameron why was his face shown in the closing cermony,just a quick flash mind you,was at the start if you missed it.

 

 

# cuckooshoe 2014-08-03 23:14

www.2b1stconsulting.com/…/

Covering 220 square kilometers, BP and its partners have estimated Clair to hold 8 billion barrels of oil equivalent (boe) of in-place reserves.

Continues..

“Located in a region of the North Sea (?)concentrating up to 17% of the UK oil and gas reserves, the Clair field should tell in 2015 to BP and its partners Chevron, ConocoPhillips and Shell how much capital expenditure to plan for the Greater Clair project that could come on stream in 2020.”

 

 

# Skybolt 2014-08-03 23:21

The potential of the Clair field has been known for a long time. I worked on the Semi-Submersible Santa Fe Rig140 about 1990 when we drilled and discovered that field. The problem was that the crude was thick and as the water depth was around 2 thousand feet – and very cold, the oil would ‘congeal’ and would not flow well to the surface for exploitation.

Looks like, 24 years on, they have found a solution 🙂

 

 

# Rafiki 2014-08-04 00:00

The Flag in the Wind.
www.scotsindependent.org/…/ Scottish Atlantic Margin

More oil than has ever been dreamed of.

This has a gremlin; if you go to www.scotsindependent.org click on Features and scroll down to Scotland’s Atlantic Margin it should work OK

 

 

# davidredero 2014-08-04 01:49

I know this is a passionate campaign and we’re all looking for something to swing support, but this is really stretching the realms of what a serious website should be covering. This is a story stemming essentially from a facebook post – a rather oddly written article about someone “overhearing” a rig manager talking about workers being sent home with full pay until September. That’s essentially it as far as the evidence goes. Some people are even citing this as the “largest oil field in the world” on the basis of a throwaway line in that article.

Honestly, I’m despairing at this. All that’s going to happen if this story gets pushed too far is someone in an official capacity at BP will make a statement rubbishing it and half the Yes campaign will look like a bunch of conspiracy theorists. Newsnet Scotland should not be trying to stir this up – your site has far too high a profile for that.

 

 

# Marian 2014-08-04 17:08

Whilst there is no doubt that the Clair oilfield would a hugely lucrative asset to independent Scotland and its existence blows away unionist scaremongering about the oil running out, we must keep a sense of proportion here as the posts on the story claiming its the biggest in the world, have rumour factory origins.

Claims that its the biggest in the world and that rig crews have been sent home lest they spill the beans are rumours and nothing else at this stage.

 

 

# cuckooshoe 2014-08-04 17:21

Strange response. The link I provided comes from the oil industry. It states oil from Phase 2 of the Clair Field will come on-stream in 2016. The consortium are planning for Phase 3 and have invested in several appraisal wells. They want to determine how big the Clair Field is so they can invest appropriately. It’s in black and white –

“Size and nature of the processes to be mobilized to develop Greater Clair

– Additional installation to be added to Clair Ridge to optimize production and extend the plateau production period.”

 

 

# Macart 2014-08-04 03:07

Cameron and Carmichael? No publicised walkabout?

If the rumour is true and the investment activity of the past two years would suggest there is something to it, how would the general public feel about being lied to yet again on this subject?

Better yet. If true and the PM has prior knowledge of this find what does this say about partnership and trust between Westminster and the Scottish electorate that he has not come forward with news of the find?

 

 

# Alien Act 2014-08-04 09:31

There has never been a partnership between Westminster and the Scottish electorate, those of us that were around in 1970s know that for a fact. They took a conscious decision, a deliberate wilful act, to lie to the Scottish people then, and covered it up for the next thirty years, and if it wasn’t for the freedom of information act their lies would still be secrets.
The duplicity and underhand tactics that Westminster used in 1979 to keep Scotland’s oil should be a reminder to the Scottish people of exactly how low the UK government can get and of how far they will go to keep Scotland’s wealth.

They employed these tactics in 1979 and they will again employ them in 2014, regardless of this oil find story being real or just a rumour we must be vigilant to their dirty tricks and make sure they are reported on social media and independence websites like this one, whenever they are discovered.

 

 

# Macart 2014-08-04 12:09

Yep, well aware of all of that and then some. 😀

How and ever the point I’m making is that their narrative has been ‘the most successful partnership/union in history’ and what the possible fallout/reaction may be for sections of the electorate on discovering they weren’t really such trusted ‘partners’ after all.

 

 

# Tappietourrie 2014-08-04 08:30

Looks to me like a repeat of what went before (mcCrone) to quell the independence issue.
For a more realistic view of what you won’t hear or see in the msm relating to Scotland’s oil and gas reserves look at the following reports on Bella Caledonia web site below. bellacaledonia.org.uk/ ‘The Real State of Scotland’s Oil and Gas Reserves- dated 11/06/2014’ and ‘Scottish Mainland Oil and Gas – dated 12/06/2014 also oil company reports regarding the amount of investment going into exploration in the Scottish sector. Follow the money!

 

 

# gerrydotp 2014-08-04 09:52

I don’t care if we are richer or poorer.
If we’re richer, we will spend it wisely guided by our new written constitution. If we’re poorer, we’ll innovate and diversify to stimulate the economy to the benefit of us all.
The point being that We will do it for ourselves, in our own way and reflecting our own beliefs and values, not to the Westminster model of unbridled greed, lies and warmongering.
Ignore the MSM.

Vote Yes.

 

 

# Onwards 2014-08-04 09:59

It’s not uncommon for oil discoveries to significantly increase in size after appraisal wells extend the find. Initial estimates are often very conservative, and Clair is already seen as a ‘monster’ field.

Also recovery rates end up being much higher as technology improves. Statoil is now approaching 60% average recovery rates and is aiming for 70%.

The UK government has a past record in trying to conceal the extent of Scotland’s oil wealth, so there would be no surprise if pressure was being put on BP to delay the recent Clair drilling results, or new estimates.
Unlike smaller companies, BP is big enough that it doesn’t have to report individual well results to the market.

 

 

# Virgil 2014-08-04 11:20

[quote name=”Onwards”
Unlike smaller companies, BP is big enough that it doesn’t have to report individual well results to the market.
That’s just wrong Onwards.

BP, like all listed companies, has a duty to act in the interests of its shareholders. They would be breaking the law if they deliberately withheld information (e.g. a massive oil find) which would materially affect the share price.

Approximately 800 million BP shares will be traded between now and the referendum. If BP were deliberately suppressing the share price by withholding information, not only would they be breaking the law but they would be relentlessly pursued through the courts by those who had sold those 800 million shares at a discount due to the withholding of information.

This is a nonsense story and quite frankly it is embarrassing the amount of people who will credulously take this sort of guff in.

 

 

# Onwards 2014-08-04 16:47

BP needn’t withhold info.. but they can delay it ‘until further tests’ or such like. This sort of thing happens all the time for commercial reasons.

You also have to remember that the UK government dishes out the licenses, and controls the tax breaks, so BP will play nice here.

Anyone who thinks that the UK government would want news of a major find to be announced months before the referendum would have to be extremely naive.

UK governments have deliberately played down the extent of oil for years, Tory and Labour alike. Even now their resource estimates are ridiculously low – less than half that of the industry !!

Ex labour chancellor Denis Healey recently admitted “we did underplay the value of the oil to the country because of the threat of nationalism.” and “I think they are concerned about Scotland taking the oil, I think they are worried stiff about it.”

 

 

# RTP 2014-08-04 10:01

More political shenanigans from Westiminster.
Good article by Dick Winchester in the Energy section of the P&J; today,sorry don’t have a link but Newsnet might be able to print the story.

 

 

# Breeks 2014-08-04 10:59

Maybe it’s nothing to do with oil. Maybe there’s a secret bunker up in Shetland and Mr Darling won’t come out until Mr Salmond goes away.

 

 

# Brodie 2014-08-04 11:40

O/T –
“The debate will begin at 8pm with the results of a new poll on voting intentions.”

Which will, of course, show that “Yes” is trailing badly, blah, blah, blah.

An obvious ploy to try to put Salmond on the back foot before he’s even uttered a word – courtesy of our “impartial” friends at STV.


Announcing the poll at the start is them signalling: “no matter what Salmond says don’t even dare to think that ‘Yes’ might actually win.” What kind of “impartiality” is that?

These blatant attempts to manipulate public opinion really do get very tiresome indeed.

 

 

# Alien Act 2014-08-04 12:03

And if I was the No camp, I would be telling my followers to vote Yes on the way in and No on the way out. Just to make sure the vote was distorted in my favour.

 

 

# Claverhouse 2014-08-04 11:48

A Yes vote will allow the building of these facilities in Scotland and bring much needed work to the yards

So what does Scotland get out of the oil at the moment…a few jobs and no profit

 

 

# macduff 2014-08-04 12:25

Whilst I take on board the points made by Virgil regarding BP possibly breaking the law, would it be possible for Cameron to make this a “national security issue” and require BP to withhold information until after the referendum?
He could say that release may “invoke civil unrest” should the truth come out

 

 

# Seagetagrip 2014-08-04 13:02

The thing is Virgil. Do you think that the oil to the West of the Hebrides and Shetland was stolen from under our noses. It was certainly there fifteen years ago.
The only reason it has not been collected is because of lack of expertise re its` collection,
Imagine the idiots about to invest 4.5 billion on drilling. Maybe you should tell them!

 

 

# Virgil 2014-08-04 15:14

I am not sure if I get the point you are trying to make Seagetagrip.

Nobody is saying the oil isn’t there anymore – that’s just plain daft. In fact, the Clair field was discovered in the 70s and is as big as anything found in the North Sea. It is not a new discovery. However, the oil is heavy and the geology poor, and the geology is what is limiting the expected recovery from the field.

 

 

# JaceF 2014-08-04 15:04

Don’t know if this adds anything:

theenergycollective.com/…/…

“The basement play has been largely ignored in the U.K. It is potentially a game changer for companies, particularly West of Shetland. BP’s massive Clair Ridge development, sits at the other end of the Rona ridge from where Hurricane is active. BP is looking at the third phase of the Clair development and says the field could have 8 Bbbl of oil in place. Given that BP has produced oil from basement with earlier Clair well tests, the potential offered by productive basement reservoirs could add a significant amount to that. In fact, BP has invested in Hurricane. The U.K. government is very keen to see the basement reservoirs developed, and is making noises about offering tax losses for the basement play, which could certainly improve the economics.”

 

 

# Auld Rock 2014-08-04 16:03

Hi Rafiki. I have highlighted the oil/gas reserves both offshore and onshore and I have also offered people a copy of Bill ‘Big Mac’ McLaughlin’s two papers on this. Once again I will be happy to send a copy to anyone interested, just email me at: asterix.says.yesgmail.com

Also the articles in the Scots Independent referred to were also the work of Big Mac.

 

 

# andy-cap 2014-08-04 16:47

Now lets just see what will happen to all this black gold if we vote no, firstly HS2 will go ahead then London sewers upgrade, Trident upgrade, new fighter jets,a full Westminster refurbishment a third Heathrow terminal,an upgrade of London’s underground and many many other goodies for Westminster.

Whilst in Scotland they’ll be more austerity and attacks on the poor and disabled, surely we’re not that stupid to vote no are we?.

 

 

# Onwards 2014-08-04 17:54

The ‘oil in place’ estimates for Clair are an good example of increases over the years, as the reservoirs are proved up.
2 to 4 to 6 to 8 billion barrels.

The recent appraisal wells could extend this further.

Recovery rates should also end up being far higher than initially thought, with the new technology used such as heated pipes and low salinity waterflooding.

And as mentioned above, there is the added potential in the Clair basement rocks after the recent success of Hurricane’s Lancaster well on the same trend?
hurricaneenergy.com/…/…

Perhaps this is what some of the new appraisal wells have been targeting?

If similar horizontal wells work well in the Clair basement then the increase in reserves could be huge..

 

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