Orcadian Energy is pleased to note yesterday's announcements from both Serica and The Parkmead Group plc.
Steve Brown CEO of Orcadian Energy said:
"We are really pleased to hear that Serica will acquire Parkmead (E&P) Ltd and will become operator of licence P2634. Orcadian holds a 50% interest in this licence, and we welcome Serica's purchase of this very significant opportunity, which has the potential to be one of the largest remaining oil developments in the North Sea."
Fynn Licence P2634
The licence contains a very substantial viscous and heavy oil discovery which has a gross P50 contingent recoverable resource of 292 MMbbl, based upon the latest operator estimates.
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The Fynn licence is situated in the Outer Moray Firth and comprises blocks 14/15a, 14/20d and 15/11a. Orcadian (50% interest) together with the licence operator Parkmead (50% interest), will leverage expertise gained in developing viscous crudes to work towards commercialisation of Fynn Beauly, which is one of the UK's largest undeveloped discoveries. This oil accumulation has been proven by three wells and is estimated to contain most likely (P50) gross contingent resources of 292 MMbbl, 257 MMbbl of which is on the licence; a resource of the same scale as Rosebank.
The approved three-year work programme will progress towards a technically and economically viable development, that can be delivered within the context of the NSTA's Net Zero Strategy. By undertaking geophysical, geochemical and reservoir modelling studies the work will assess the feasibility of implementing polymer flooding with geothermal heat uplift to improve recovery.
Why Viscous Oil Matters
The oil within the Fynn reservoir is viscous and made up of long chain hydrocarbons, which means that when refined it contributes little to gasoline supplies, but is a good feedstock for lubricants, asphalt and anode grade petroleum coke (an essential component for fast charge EV batteries). Orcadian believes that gas and viscous oils will be the post-transition hydrocarbons essential to the prosperity of every economy.
Why Domestic Production is Best
Producing heavy oil domestically, under the stewardship of the NSTA, is a considerably better option than importing these oils from Venezuela or Canada. Both these countries produce most of their heavy oil using thermal means - steam assisted gravity drainage, cyclic steam stimulation or steam flood. The measure of efficiency of all these techniques is the steam-oil ratio, which is the number of barrels of cold-water equivalent of steam required to recover a barrel of oil. An outstanding steam oil ratio is two, but steam-oil ratios of four or five are common. The CO2 emissions from burning gas to generate the steam are approximately 30 kgCO2/bbl of water. So, emissions per barrel from imports from Canada or Venezuela are typically 60 to 150 kgCO2/bbl, even before the transportation emissions are accounted for. It is these high emission levels, and the strip mining and chemical processing often used for extra-heavy oil extraction that have given heavy oils such an undeserved reputation.
With a polymer flood approach, by incorporating heat from geothermal sources to reduce reservoir oil viscosity, and by electrifying production systems using green energy, the emissions per barrel in the production process can be reduced to single figures, better than most UK light oil fields. The UK and her allies need viscous oils both for strategic security of energy and for the petroleum-derived products that support both the transition and the post-transition economy.
Buying these products made from imported petroleum rather than our own oil also damages the balance of payments, eliminates great jobs, and increases actual greenhouse emissions.
In summary we are delighted to have the Fynn licence in hand and we are committed to finding a way to produce this essential oil with the least emissions possible.
