Corallian Energy Limited – Wick Well FAQ

Corallian, the operator of the P2235 and P1918 licenses which contain the Wick and Colter prospects. The Wick well, 11/24b-4, is being drilled using the Ensco 72 jack-up drilling rig.

Offshore Licence P2235

The licence contains the Wick Prospect, a fault-bounded trap with Jurassic sandstone reservoirs lying up-dip of the spill point of the Lybster oilfield in the Inner Moray Firth Basin. Pmean Prospective Resources are estimated at 26 million barrels of oil equivalent (gross).  Corallian holds a 40% interest in the licence and is Exploration Operator.

Who is Corallian?

Corallian Energy Limited (Corallian) is a private oil and gas appraisal and exploration company and the Licence Administrator. It is the lead company in a partnership of companies and as such manages the work programme and administers the petroleum licence on behalf of the partners under a Joint Operating Agreement (an agreement based on an industry standard structure, in the case of the UK one developed by UK Oil and Gas Limited, a body representing the UK oil and gas industry) and is the point of contact for the regulators.

What is the water depth at the drilling location?

38.5 metres.

What type of drilling rig will be used?

Offshore oil & gas wells in shallow water (less than 100m) are generally drilled with a jack-up rig. The rig is towed into position and jacks its legs on to the sea bed and lifts itself clear of the water. This process is reversed when drilling operations have been completed, leaving no sign of the drilling operation having taken place.

Why has Corallian chosen the proposed well location as its exploration site?

Corallian and its partners have chosen this site based on the interpretation of 3-Dimensional seismic data acquired over the area in 2007.

This seismic survey, along with other data acquired from previous exploratory wells and other relevant survey data were used to identify a geological structure (termed the Wick prospect) which might have the potential to have trapped oil or gas.

The well will target separate geological sandstone layers of Jurassic and Triassic age which can be evaluated with a single vertical well.

How is the offshore oil and gas industry regulated?

In the UK, the overarching legislation for oil and gas exploration and production operations is the Petroleum Act 1998; this is supplemented by various environmental regulations.  Until 2015, petroleum activity was primarily regulated pursuant to the Petroleum Act 1998 by the Department for Business, Energy and Industrial Strategy (BEIS).  However, in 2015 the Oil & Gas Authority (OGA) was established as an executive agency of government responsible for regulating both onshore and offshore oil and gas exploration and production, including oil and gas licensing.  The OGA has since formally gained its status as an independent Government Company under the Energy Act 2016.  BEIS, through its Offshore Petroleum Regulator for Environment and Decommissioning (OPRED) has retained responsibility for administering environmental regulations covering offshore petroleum operations, including oil and gas exploration operations.

How long will the exploration activity last for?

Drilling time for the proposed well will be up to 25 days, with the rig anticipated to be on location for a maximum of 30 days.  Following completion of the drilling operations, the well will be safely and permanently “plugged and abandoned” following the guidance developed by Oil and Gas UK.

What does “permanently plugged and abandoned” mean?

Once the drilling and evaluation is completed cement will be pumped into the well and pressure tested to ensure it is stronger than the surrounding rock. The casing will then be cut below the seabed leaving no trace of the well having been drilled on the seabed. The drilling rig will then jack-down and depart the location.

What happens to the drilling and other waste?

The proposed drilling operation will generate various waste streams which will either be treated, discharged or disposed of onshore, ensuring any environmental impacts are minimised.  Key to waste management will be adherence to the waste hierarchy principles (i.e. remove – reduce – reuse – recycle – recover – treat – dispose).  Only licensed and approved onshore handling, treatment and disposal facilities will be used.

During the proposed drilling operations, the most significant waste stream will be the discharge of drill cuttings, mud and cement to sea.  An application has been made to the Scottish Environment Protection Agency (SEPA) under the Water Environment (Controlled Activities) (Scotland) Regulations 2011 (as amended) to permit this discharge (Ref: CAR/L/1166721).

The majority of mud chemicals used during the proposed drilling operations will comprise naturally occurring products (such as barite and bentonite) that are either biologically inert or readily dispersible or biodegradable, posing little or no threat to the environment. Once the drilling effluent is discharged to sea it will be subject to rapid dilution and dispersion.

It is anticipated that the discharge of drill cuttings could create a pile that will result in a temporary disturbance to the seabed, predicted to cover an area of up to 0.04 km2 around the well location (assuming a deposition level of 1 mm or above). This is a relatively small area in comparison to the seabed available across the Moray Firth, with similar water depths, sediment types and benthic communities. The recovery of the affected area of seabed is expected to be relatively rapid once the proposed drilling operations have ceased. Of note, is that in areas of shallow water (<50 m) with stronger currents, drill cuttings are rapidly dispersed and cuttings piles do not normally form.

When drilling through the reservoir objectives, in the event that oil is encountered, the drill cuttings may contain residues of reservoir hydrocarbons (called oil shows). In the event that oil shows are observed, Corallian is committed to containing these cuttings.  These cuttings would be skipped and shipped to shore for appropriate treatment and disposal.  However, if no oil shows are observed, these cuttings will be discharged to sea, as per the non-reservoir well sections.

Domestic wastewater will be collected and treated on the rig prior to discharge.  The rig will therefore have an approved and certified sewage treatment plant onboard.

Domestic waste including food waste and operational wastes (e.g. waste oil, chemicals sacks, contaminated rags etc.) will be collected in containers on the rig and sent to shore to suitable and approved waste treatment facilities.

Does the exploration activity pose a significant risk to human health?

The only potential risks to human health relate to the general health and safety hazards presented by any industrial site, which are only applicable to personnel at the site.

Does the exploration activity pose a significant risk to marine life health?

No, the proposed drilling operation does not pose a significant risk to marine life health. The various aspects of the proposed activity that have the potential to impact marine life have been assessed as part of the Environmental Impact Assessment process. It has been concluded that the proposed drilling operation will not result in any significant effects to the marine ecosystem provided that all identified mitigation measures are implemented.

In addition, a Habitat Regulations Assessment screening exercise has been undertaken to determine whether there will be any likely significant effects on European (Natura 2000) sites arising as a result of the proposed drilling operations, either alone or in-combination with other plans or projects. The HRA Screening concluded that under normal operating conditions no likely significant effects on any Natura 2000 site are anticipated. A major (worst case) release of hydrocarbons has the potential to result in likely significant effects on a number of Natura 2000 sites. However, as the assessment has been based on unlikely worst-case scenarios, assuming a complete failure of all control and preventative measures with no source control or response actions initiated, the risk of likely significant effects on Natura 2000 sites from unplanned events is considered to be as low as reasonably practicable and tolerable.

Will the proposed exploration activity impact local air quality?

No, the proposed exploration activity will not impact the coastal air quality. The atmospheric emissions associated with the combustion of hydrocarbons for power generation on the drilling rig and supporting vessels will only cause a short term deterioration of local air-quality within a few metres of the point of discharge and are predicted to rapidly disperse.

How is the well drilled?

The well is drilled in sections using hollow drill pipe fitted with a drill bit on the bottom. After drilling a section it is lined with steel pipe known as casing which is cemented in place and pressure tested to ensure the rock is isolated from the well and surface. Each section drilled has a smaller diameter than the previous section. The typical sequence of hole diameters drilled is 36”, 17½”, 12¼” and 8½” with the smallest diameter being at the bottom of the well.

How reliable are the casings which are planned to be installed in the well?

The specification of the casings to be installed in the well, have been determined by experienced drilling engineers using complex engineering software. The design is based on the worst-case loads that could be experienced during the life cycle of the well including a safety factor. The design is checked by an independently appointed well examiner. The casings are then procured from reputable suppliers following a rigorous inspection programme. This method of design and procurement will ensure the construction of a pressure tight well.

How deep are you drilling?

The well is being drilled to a depth of approximately 1,200 metres below sea level.  The chosen well location will allow for a vertical well to be drilled, which is considered to be the most effective design as it minimises the duration of the drilling programme, resulting in fewer emissions, discharges and waste compared to that of a directionally drilled well. A vertical well is also required to evaluate several target intervals, including Jurassic Upper Brora Sandstone at 671 metres, Beatrice “A” at 809 metres and Triassic Lossiemouth Sandstone at 1,038 metres, all depths below sub level.   

How will you stop oil, gas or other pollutants from travelling up the well?

Whilst drilling a fluid (known as mud) is pumped down the inside of the hollow drill pipe and out of nozzles in the drill bit. This mud is designed to be heavy enough to prevent fluids from within the rocks from entering the well. The mud also lifts the drilled pieces of rock out of the well and cools the drill bit.

When the mud returns to the rig from the well it passes over sieves, known as shakers, to remove the pieces of drilled rock before being pumped back down the well.

Are there any chemicals in the mud and are they safe?

The water requirements for drilling are, relatively speaking, quite small. During the proposed drilling operations, seawater and water-based mud (WBM) will be used to facilitate the drilling processes and ensure the safe completion of the well. The majority of the WBM chemicals will comprise naturally occurring products (such as barite and bentonite) that are either biologically inert or readily dispersible or biodegradable, posing little or no threat to the environment.

Will hydraulic fracturing (“fracking”) take place?

No.  Corallian is exploring for oil and gas in the naturally occurring spaces between the mineral grains of the porous sandstones and not shales. This is referred to as conventional exploration and production.

Will the proposed well be flared?

The well will not be flared and no reservoir hydrocarbons will be flowed to the surface.

What happens if oil or gas is found in the well?

In the event that hydrocarbons (oil or gas) are found in the rocks a number of formation evaluation tools will be run into the well to take measurements such as pressures to enable an evaluation of the size of the discovery. The company will evaluate the underground strata using instruments lowered into the well.  No hydrocarbons will be flowed to the surface.  

Will the drilling be visible from the shore?

Yes, the well will be drilled approximately 2.3 kilometres from the Caithness coastline and the drilling rig and supporting vessels will be visible from the shore. A seascape and visual impact assessment was carried out as part of the Environmental Impact Assessment.  This concluded that temporary effects on the seascape and visual amenity are likely to be locally significant within approximately 5 km of the well location. However, given the localised and temporary nature of the potentially significant impacts identified, the overall conclusion is that the effects of the project on the landscape and visual resource, when considered as a whole, would not be significant.

Will the drilling activities impact recreational or commercial activities in the area?

The physical presence of the drilling rig and support vessels and the 500 m safety exclusion zone around the well location have the potential to interfere with recreational and commercial activities in the area, including commercial shipping, offshore wind farm and oil and gas support vessels, fishing vessels and recreational vessels. The temporary presence of the drilling rig and other support vessels at the surface can pose a navigation hazard to vessels and present a collision risk. However, none of the effects on the recreational or commercial activities are expected be significant.

It is likely that commercial shipping and recreational vessels will have to adjust their routes to avoid the drilling rig and associated 500 m safety exclusion zone, but there is ample sea room available to the south east for them to do this and this effect will be temporary for the duration of the proposed operations only (up to 30 days). A number of measures will be in place to ensure advance notification of the drilling operations is provided and that the risk of a vessel to vessel collision is reduced to as low as reasonably practicable.

It is acknowledged that fishing vessels may be temporarily displaced from an area of 0.8 km2 at the sea surface; however, it is likely that vessels will be able to switch to other fishing grounds in the short-term as the fish stock present in the vicinity of the proposed well is not exclusive to this area. It is also considered possible that support vessels en route to / from the proposed well location could sail over and damage or destroy static fishing gear. An onshore Fisheries Liaison Officer will therefore be appointed to maintain good communication with local fisheries, define a safe passage zone with the local fishing community and co-ordinate activities throughout the drilling operations.

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What are the permits and consents required to drill the well and who issues the permits?

The proposed drilling operation is subject to a number of environmental regulations. Several of these require environmental permits and consents to be in place prior to the proposed drilling operations commencing.

The consent of the Oil and Gas Authority (OGA) is required to commence the drilling of any oil or gas well offshore.  Each application to drill is considered with respect to the fulfilment of specific licence obligations and impact on the environment and other users of the sea.  The Department for Business, Energy and Industrial Strategy (BEIS), through the Offshore Petroleum Regulator for Environment and Decommissioning (OPRED) is responsible for administering environmental regulations covering offshore petroleum operations. Corallian has therefore prepared an Environmental Statement to present the findings of an Environmental Impact Assessment carried out for the proposed drilling operations, as required under The Offshore Petroleum Production and Pipelines (Assessment of Environmental Effects) Regulations 1999 (as amended).  The Environmental Statement has been submitted to OPRED for consideration in determining whether to agree to the grant of consent for the proposed drilling operations.

In accordance with the Habitats and Birds Directives, competent authorities must undertake a formal assessment of the implications of new plans or projects that may have an effect on the designated interest features of European (Natura 2000) Sites before deciding whether to permit or authorise a plan or project.  This assessment comprises several distinct stages, which are conveniently and collectively described as a ‘Habitats Regulations Assessment’ (HRA).  As the proposed well will be located within 80 m of a Natura 2000 site (i.e. East Caithness Cliffs Special Protection Area / Nature Conservation Marine Protected Areas) and lies in close proximity to a number of other European Sites, Corallian has included data within the Environmental Statement to enable the competent authority (OPRED) to undertake a HRA.

As the proposed well is located within Scottish ‘coastal waters’, the drilling operation is subject to control under the Water Environment (Controlled Activities) (Scotland) Regulations 2011 (as amended) (hereafter referred to as ‘CAR’).  These regulations are administered by the Scottish Environment Protection Agency (SEPA) and apply regulatory controls over activities which may affect Scotland’s water environment. Fraser Well Management as the well operator has therefore applied to SEPA for a CAR Licence to seek consent for these activities (Application No. CAR/L/1166721).

Under the Petroleum Act 1998, exclusive rights to search, bore for and obtain petroleum in Great Britain and under the territorial waters of the UK are vested in The Crown; for all practical purposes this constitutes ownership.  The Crown Estate grants varying types of agreements, leases and licences for construction or longterm activity on the foreshore and seabed (Crown Estate, 2018).  The Scotland Act 2016 paved the way for the devolution of Crown Estate management in Scotland to Scottish Ministers and a new public body, Crown Estate Scotland, has been established by The Crown Estate Scotland (Interim Management) Order 2017.  As the proposed drilling operations will take place in Scottish inshore (territorial) waters, Corallian will require a licence from The Crown Estate Scotland for the activity.

The Merchant Shipping (Oil Pollution Preparedness, Response and Cooperation) Regulations 1998 (as amended) implement the International Convention on Oil Pollution Preparedness Response and Co-operation 1990 and require that every offshore installation and oil-handling facility must have an approved oil pollution emergency plan (OPEP) in place, setting out arrangements for responding to incidents that cause or may cause a hydrocarbon pollution incident at sea.  The 2015 Amendment Regulations implement the requirements of the EU Offshore Safety Directive (2013/30/EU) in the UK.  The primary aim of Directive 2013/30/EU is to address major accident hazards and reduce the associated risks to the health and safety of the workforce employed on offshore installations.  However, the Directive also aims to increase the protection on the marine environment and coastal economies against pollution and to ensure appropriate response mechanism are in place in the event of such an incident.  OPRED forms part of the competent authority (the Offshore Safety Directive Regulator; OSDR) established to implement the Offshore Safety Directive in the UK, in partnership with the Health and Safety Executive.  OPEPs approved by OSDR, will therefore be in place in advance of the proposed drilling operations commencing.

In addition to the above, it is anticipated that a check shot survey may be carried out once the proposed drilling operations have been completed. Check shot surveys are seismic borehole surveys that are designed to gather high-resolution data on the subsurface geology within the wellbore itself.  Due to the nature of the operation and the potential to disturb marine mammals, an application will be made to Marine Scotland for a licence to disturb or injure marine European protected species (EPS) under the Conservation (Natural Habitats, &c.) Regulations 1994 (as amended).

Fraser Well Management Limited is the Well Operator, what does that mean?

Under the Offshore Petroleum Licensing (Offshore Safety Directive) Regulations 2015, Corallian has appointed a third party well operator; Fraser Well Management (FWM), to undertake the proposed drilling operations. FWM is a specialist well engineering and well management company delivering full well lifecycle services to clients.

FWM has a robust field proven integrated Quality and Environmental Business Management System (QE BMS), which is certified in meeting the requirements of ISO 14001:2015 (environmental).  Implementation of the QE BMS will help ensure compliance with all permits and consents.

Source Link 

Environmental Statement

Click on the following links to download documents

Environmental Statement Volume 1

Environmental Statement Volume 2

 

 

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