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Gas Giant: Culzean’s four-year journey to production

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Four years since its approval, Total’s Culzean HPHT development is now on stream. Wireline learns what it takes to deliver a $5 billion megaproject on-time and under-budget.

To describe the past 12 months of operations at Total as ‘busy’ would be something of an understatement. With the significant discovery at Glendronach in September 2018, followed by the estimated 250 million boe Glengorm discovery alongside operator CNOOC Limited in January 2019, the French-headquartered supermajor had posted the two largest finds for a decade in the space of a few months and further cemented its position as one of the linchpin gas producers on the UKCS.

All the while, progress at the Culzean field – the previous record holder for a UKCS find – has continued apace, culminating in the production of first gas in early June 2019. Located on Block 22/25a, 230km off the cost of Aberdeen, the high-pressure, high-temperature field (HPHT) is a flagship development for Total and its partners (BP, 32%; JX Nippon, 18.01%) having assumed control of the project as part of its takeover of Maersk Oil. Recoverable reserves at the field exceed 250 million boe and planned output will reach 100,000 barrels of oil equivalent per day (boepd), providing around 5% of the UK’s gas consumption. In doing so, Total will also increase its share of overall UK demand to 18%, assuring its place as the largest single UK gas producer.

Wireline last spoke with members of the Culzean team in 2015, following the field development approval issued by the OGA. With all facilities now in place and production ramping up to plateau, we caught up with project director Claus Vissing-Jorgensen in late summer to hear his thoughts on the successes and challenges of delivering a megaproject like this, and what it represents for those who worked on it.

High-pressure environment

Vissing-Jorgensen has been involved in the project since 2013, as a facilities manager, before becoming project director in 2018. Having been responsible for contracting strategy and execution, and later project delivery, he has been at the heart of Culzean from the beginning. Over that period, he has overseen a team which has managed not only to deliver on time, but to do so $500 million under budget.

Culzean’s $5 billion capital budget is mirrored in its myriad components. “Culzean has all the features that make up a megaproject,” Claus says, “It has all the variety of traits involved – you’ve got the drilling of new wells, new facilities installed, you’ve got around 7,000 people involved at peak.” Coupled with its “strategic size” in relation to the UK’s future gas supply, he says the importance of delivering on time, safely and within budget is clear.

At the time of writing, it has been around four years since Culzean received project approval in September 2015. The wellhead platform jacket was installed in 2016, while drilling began later that year from the newbuild Maersk Highlander jack-up. Further jackets were added in 2017 alongside the installation of subsea infrastructure, including the 52km subsea pipeline which connects the facilities to the Central Area Transmission System (CATS) T5 tie-in point to the south.

The MODEC-designed FSO vessel Ailsa, moored at the Culzean field.

Over the same period, a pipe-in-pipe connection pipeline was installed to relay between the Culzean central processing unit and the floating storage and offload (FSO) vessel Ailsa, which handles condensate export. Designed by MODEC, the 243m newbuild ship can receive up to 25,000 barrels of condensate per day and has a total storage capacity of 430,000 barrels. It is anchored in place 4km from the Culzean topsides via a SOFEC turret mooring system.

Culzean’s topsides (five modules spread across the three platforms) arrived from Singapore in July 2018, along with the FSO, kicking off the hook up and commissioning operation. Claus estimates that the hook-up involved “around 700 people” in the field, including more than 100 personnel on the drilling rig itself, again confirming its status as a true megaproject.

The hook up and ‘dynamic commissioning’ continued for just under a year, culminating in first gas on 7 June 2019. “First gas export was reached in July,” Claus continues, “and we are currently sitting in a pretty good place with four wells online and nearing our production plateau.”

In addition to the project scale, the reservoir itself presents challenges. “Compared to a normal reservoir, it’s about five times the pressure and two times the temperature,” he explains, “Which of course makes it a little bit more complex – you need high-integrity process systems to mitigate any risks.” With that in mind, it is all the more impressive that the drilling team exceeded expectations, bringing four wells online in the time initially allotted for three. “That allows us to reach our production plateau slightly earlier than was planned,” he adds.

“We started out as Maersk Oil being new to HPHT developments, so we paid a lot of attention to detail and we took all the learnings from industry that we could find.”

Drilling and upskilling

In the middle of all this, there was the minor matter of Maersk’s acquisition by Total. Despite the complexity and scale of the corporate transaction, Claus describes it as a good match and has found a company structure that has been “very accommodating.” Given that progress at the Culzean field was already far underway, Maersk Oil’s plans remained relatively ring-fenced from wider changes within the organisation. Nevertheless, he says, “Total holds a lot of expertise in HPHT development, so they were quite diligent in looking at what we were doing and how we were doing it.”

Even prior to its relationship with Total, however, Maersk was building expertise within its team to deal with the challenges of developing an HPHT reservoir. The wider industry was happy to pass on knowledge, as Claus recalls: “We started out as Maersk Oil being new to HPHT developments, so we paid a lot of attention to detail and we took all the learnings from industry that we could find. We had quite a few helping hands from industry around best practices and we tried to put that into force and implement them.”

While the newbuild rig brought with it a host of mod-cons and cutting-edge technology, it also meant assembling a new team, who took time to bed in. Claus notes that Maersk conducted a lot of work around competency, planning and preparedness with the drilling crews, which played a major part in delivering results. Ultimately, he says: “What we’ve seen is excellent drilling performance from Maersk Drilling, and it’s quite complimentary given the fact that it’s both a new rig crew and a new rig.”

He attributes this performance to good processes, and the application of experience as the project progressed. “It was due to planning, preparation and essentially performance management of the wells,” he continues. “We’ve taken on the learnings and we have managed to learn and be more efficient as we complete every well.”

Key to that planning was the optimisation of drilling processes, one influential decision being the batch drilling of wells – i.e. drilling all the required top holes before moving onto the individual wells. “Obviously, that’s a feature you can apply on a new project where you start on a greenfield, so there’s a benefit in starting from scratch,” he adds.

Source: Total

Local support

Contracting for Culzean and working in partnership with UK supply chain companies has also been an important element of the project. As well as major contractors such as Sembcorp, MODEC, Subsea 7 and Hereema, Claus highlights close, collaborative relationships with suppliers including Wood Group, Semco Maritime, Bilfinger, Baker Hughes, Emerson, Siemens, Bel Valves and others. All told, around 52% of the project value has been delivered from the UK supply chain, in addition to the 200 permanent jobs required for ongoing management of the field itself.

The collaboration extends to government and to regulators. In particular, Culzean benefited from strategic support from the OGA and HM Treasury in the form of the HPHT Cluster Allowance, a tax benefit designed to enable the development of these costlier and more technically challenging fields. “I think it’s fair to say that around project sanction and FID the UK policies and regime put in place were quite helpful and basically part of the make-or-break for it going ahead, so it definitely played a significant role in that respect,” Claus adds.

Beyond that, he says that the OGA has maintained a close interest in the project, particularly as it looks ahead to future exploration and production opportunities around the infrastructure. Other highly specialised components necessitated international co-operation, particularly when it came to the high-grade steel needed for well cases and linings in order to cope with the highly saline and corrosive environments found in the HPHT reservoir. For these, Maersk reached out to Sumitomo in Japan.

Totals UKCS assets. Source: Total

The next generation of HPHT

With Culzean up and running, Total is now moving to a new operational blueprint, described as a “one-asset model.” This involves the combination of Culzean with nearby Elgin-Franklin (also an HPHT field), to create a single Central North Sea (CNS) asset. Current plans are to have this completed by October 2019, effectively creating one operation with total combined production of 230,000 boepd.

Claus says that Total has always planned to develop a North Sea ultra-HPHT hub, and the combination of Elgin/Franklin and Culzean represented a good fit for the existing portfolio: “First and foremost [the hub] is about knowledge-sharing and optimising processes. The longstanding expertise within HPHT in Total is a great thing for both assets.”

Looking at the two assets in tandem, the potential efficiencies were clear: “Some of the obvious candidates will be in logistics – the two fields are located only 15 miles from each other, and they are both 240 miles from shore, so optimisation with logistics boats and helicopters would be natural.”

Onshore, the goal is to move asset management operations for both fields into a single, digitally enabled ‘smart room’. For the new Culzean infrastructure, this support includes a full digital twin model – part of Total’s drive to run the facilities as “21st Century platforms.” This digital archive incorporates records for every piece of equipment on the platform, identified via QR codes and/or RFID tags, meaning personnel can pull up performance and maintenance records in seconds using mobile devices, allowing engineering or performance issues to be solved on site, with advice provided from onshore.

With planned operating expenditure of around £100 million per year over the field’s 13-year minimum operational life, the hope is that new technologies and processes like these can have a significant impact on bottom lines.

As for the future, additional capacity at Culzean and the larger CNS hub means new prospects could be tied back in the coming years. Current production capacity is 500 million cubic feet of gas throughput per day, 25,000 barrels of liquid handling and 5,000 barrels of water, but Culzean does have space to host another 2,000-tonne topside module to cope with an influx of additional resources – or even another bridge-linked platform (BLP) should the team find something of major scale.

“It’s fair to say that we haven’t found the next Culzean project yet,” Claus says (although Glengorm may well be poised to take up the mantle). “But we are targeting other prospects in the area – not in the same scale, but as with any new asset in a new area we will always be looking to see what the future is and if we can fill the hopper with prospects.”

While Culzean may be unseated from its record-holding heights by the likes of Glengorm and Glendronach, its importance – to Total and to the UK – cannot be understated. Its unification with Elgin-Franklin under the CNS model not only cements the supermajor’s expertise in North Sea HPHT, but also helps secure the future of these assets for many years to come. In the meantime, he says that drilling will continue to ensure production rates over the medium term. “The best way to get access is to drill more wells, so we’re working on that to generate more future for Culzean.”

 

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