StatoilHydro reports the discovery of hydrocarbons in two wells in the Oseberg area, located in the Norwegian offshore sector of the North Sea. The first discovery was made in a long-reach exploration well from the Oseberg C platform, targeting the Cook Formation in the Theta structure.

“The well is designed to be converted to a producer within 45 days after the discovery, giving an extremely quick turnover from prospective resources to producible reserves,” says Oseberg Petech project leader Trond Eide.

Prospect mapping and well planning was a collaborative effort between the Oseberg Petech team and the North Sea infrastructure-led exploration team, with the former unit being responsible for the drilling operation.

“Work is currently underway to determine the optimal production solution,” says Bjørn Inge Braathen, leader of the exploration team working in the Oseberg area. Depending on the development solution, preliminary expected volumes are around 5 million barrels of oil.

Shortly after the Theta discovery, oil and gas was also found in the Delta S2 structure in the Oseberg South area. The Delta S2 discovery targeted the Brent Group, and is believed to contain about 16 million barrels of recoverable oil equivalents. Well 30/9-21S was drilled by Transocean Winner, and the rig is now drilling a second branch to test the nearby Richards prospect.


“We have been excited about the prospectivity of the Oseberg area for a long time, and after a few years of limited exploration in the area it’s good to see that the efforts are stepped up in a successful manner,” says Tom Dreyer, vice president for infrastructure-led exploration North Sea.

The Delta S2 discovery may be tied to the nearby Delta template within a few years and continued exploration success in the area may trigger new development solutions.

Antrim Energy Inc. confirms the successful completion of drilling and testing operations on the Fyne Field (Antrim WI 75%), in the UK central North Sea. The Transocean Prospect was released from contract on May 9th, 2008.

The Fyne Field appraisal well 21/28a-9 was, as planned, drilled with three legs, one pilot hole and two sidetracks into the Eocene Tay Formation. As originally designed, the final sidetrack 21/28a-9y was cased to be used as a future production well.

As previously reported, the logging and testing results indicate a wellbore measured net oil pay thickness of 120 ft and 47 ft of net gas pay in very porous and permeable sandstones. Test data indicates potential production rates of between 3,000 and 4,500 bopd, in line with the test results from the previously drilled Fyne Field well 21/28a-2.

At year end 2007, the Fyne Field and Dandy licence was determined by independent reserve evaluation engineers, McDaniel and Associates, to hold 131 million barrels oil in place or 21 million barrels of proved plus probable recoverable oil reserves (Antrim net 98 million barrels and 16 million barrels respectively), representing 42% of corporate recoverable proved plus probable reserves.

The oil and gas pay intervals in Fyne Field are separate with the gas pay confined to the Upper Tay Formation and the oil pay contained within several sandstones in the Middle and Lower Tay Formations. Internal estimates indicate that there is sufficient gas in the Upper Tay to provide artificial lift for oil production from the Middle and Lower Tay sandstones. Oil from the Fyne Field, similar to adjacent fields, is likely to be produced through a Floating Production Storage and Offloading (FPSO) system and the company is actively searching for a suitable vessel.

Gordon Brown stepped into a growing row about oil company profits yesterday, calling on BP and Shell to spend more of their combined £7bn first-quarter earnings on activity in the North Sea. The prime minister's comments came as lorry drivers took a protest on the soaring cost of petrol to central London, while other motoring organisations and environmentalists accused the oil industry of profiteering at the expense of car drivers and the planet.

"We do need the oil coming out of the North Sea; we do need to encourage the new exploration," said Brown. "That is more expensive to do. That is why I hope that these profits are going to be invested in getting more oil out of the North Sea."

BP raised replacement cost profits by 50% to $6.6bn (£3.3bn) and Shell increased its earnings by 12% to $7.8bn in the first quarter with help from a near-doubling in the price of oil since last year, although both say margins at the British petrol pump are still very slim.

The two companies have been making much of their profit abroad and have been selling off assets in Britain. BP has disposed of its Forties field, as well as Grangemouth and other refineries, and Shell has announced it is cutting 180 jobs in Aberdeen and has put a range of offshore fields up for sale. BP said last night that it was continuing to spend up to $3bn a year in the North Sea developing new fields such as the Rhum gas field and the Clair oilfield but a spokesman believed the North Sea would never be able to compete with the likes of Angola and the US Gulf, where enormous discoveries were still possible.

"You have to have something to spend it on," the spokesman said. "We have been producing in the North Sea since the 1960s at great benefit to the economy but it is a finite resource."

Shell insisted that it was pumping out more oil and gas than ever and blamed financial speculators for driving crude up to nearly $120 a barrel. Peter Voser, the company's financial director, said the weakness of the dollar, political pressures and investors switching from equities to commodities all affected the value of oil, though there was "enough product and enough crude" available.

"We don't understand the oil price at this stage," Voser said, adding that there was no immediate sign of weakening demand as a result of the US economy slowing down. "The fundamentals do not justify the oil price at this level."

Edmund King, president of the Automobile Association, warned that drivers would be shocked by the earnings at a time when they were struggling with high prices at the pump.

"The motorist feels somewhat battered from all sides, seeing the oil companies going off with cash in their pockets and the Treasury filling its coffers," he said. "It's the ordinary motorist that's bearing the brunt of this, while the oil companies and the government are laughing all the way to the bank."

He called on the oil companies to reinvest the windfall in drilling and refining, to increase the supply of oil and create downward pressure on petrol prices.

Graham Tran, regional officer of the Unite union, joined the attack on the industry. "These profits are a slap in the face for 180 staff at Shell who were told less than seven days ago that they face redundancy," he said. "Both Shell and BP have announced pension holidays for 2008 at a time when our members in Grangemouth are fighting to protect their pension fund."

Friends of the Earth's economics coordinator, Tim Jenkins, said: "Oil companies are making vast profits at the expense of the planet. Ministers should introduce a windfall tax and invest the money in tackling climate change, including a comprehensive energy-efficiency programme to end fuel poverty and cut emissions from peoples' homes.

"Oil firms must also do more to clean up their activities. There must be a fundamental shift away from fossil fuels and much greater investment in the clean, green, renewable solutions that are essential for a low-carbon future."

Richard Griffith, analyst at the City brokerage Evolution Securities, said that yesterday's figures from BP showed that new chief executive Tony Hayward's turnaround plan was "bearing fruit" faster than expected.

The City cheered the performance, pushing Shell's shares 5.5% higher to £20.43, while BP's shares gained 6% to 613p.