Production over many years has caused the ground to subside

Maersk Oil announced the largest-ever investment in the Danish portion of the North Sea today, redeveloping the country’s largest gas condensate field.

The Danish Underground Consortium, made up of Maersk (31.2%), Shell (36.8%), Nordsøfonden (20%) and Chevron (12%), approved the investment of 21 billion Danish Krone, or $3.35 billion in the Tyra field. Tyra has been around for decades, as it was discovered in 1968 and began production in 1984.

Maersk Oil, Shell Invest $3.4 Billion in Offshore Denmark

Source: Maersk Oil

Current operations consist of Tyra East and Tyra West, which have five further unmanned satellite platforms tied in. The Tyra field has already been produced extensively, so much that the ground has subsided. According to Maersk, the platforms have sunk by about 16 feet in the past 30 years, making the platform decks much closer to the harsh seas of the North Sea.

The two existing gas processing platforms on Tyra East and West will be replaced by one new platform. The wellhead platforms will be raised, and the topsides will be replaced. The renovations are extensive, so production will need to be shut in in November 2019 while facilities are replaced. Maersk estimates first production from the new platforms will begin in 2022. Installing new facilities will cost $2.7 billion, while decommissioning existing ones will cost $0.7 billion. The new facilities will be able to support expanded operations in the northern part of the field, where new projects are possible.

Maersk Oil, Shell Invest $3.4 Billion in Offshore Denmark

Source: Maersk Oil

Tyra processes 90% of Danish gas production

Shutting in this field will have major implications for Danish energy output, as Tyra processes 90% of the nation’s natural gas production. The pause will pay off, though, as the redeveloped Tyra is expected to deliver about 60 MBOEPD at peak production, and will produce more than 200 MMBOE in total. Two thirds of the output will be gas, with oil making up the remaining one third. Maersk predicts the field will continue operations for at least 25 years.

Maersk currently operates the field, but this will change soon. Total agreed to buy Maersk Oil in August, in a transaction that should close in Q1 2018.


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