INTERVIEW: Spectrum Sees Huge Potential Offshore Adriatic
It’s the second day of the Adriatic Oil & Gas Summit (AOG) in Budva, Montenegro, a summit focused on the offshore oil and gas investment opportunities within Montenegro, Croatia and Albania.
The day two started off by covering the production lifecycle for exploration from the seismic and ultrasound evaluation of potential reserves to updates on the latest drilling technology and developing offshore E&P with speakers from PGS, EMGS and Spectrum.
Croatian Ministry of Economy contracted the Norwegian seismic player Spectrum to acquire 2D Multi-Client seismic offshore Croatia ahead of licensing round in January 2015.
During the two-day summit, Jevon Hilder, Spectrum’s Business Development Manager for Mediterranean and Middle East took some time to answer a few questions for Subsea World News.
Back in 2013, the Croatian Ministry of the Economy hired Spectrum for Multi-Client 2D seismic acquisition survey ahead of its offshore licensing round, what made the Croatian government select Spectrum for this project and how was the cooperation between both sides?
The Croatian government chose Spectrum because of our regional expertise, both in the wider Mediterranean and locally with the work we had already done on the Italian side of the Adriatic. The cooperation was excellent; the Ministry of Economy and the Hydrocarbon Agency were very helpful and efficient.
Now that you have covered majority of Adriatic with Multi-Client Seismic Data, of which is approximately 15000 km related to Croatian Adriatic, what do you think about its hydrocarbon potential?
We believe the potential is huge, both for oil and gas. There are proven working hydrocarbon systems and the only uncertainties now concern whether there are viable reservoirs and traps containing economic quantities of hydrocarbons. The seismic data we acquired will help companies to minimize these risks. The seismic data is very much the first step to further exploration via further 3D seismic and ultimately drilling, both of which will be required to realize this potential.
Spectrum obviously has a strong position in the Adriatic and Mediterranean, what are your future plans for this region, do you plan to expand your seismic data library with new projects and acquisitions?
We would like to expand our seismic data library in the region for sure and are working actively to make this happen.
SeaBird’s Northern Explorer was hired for the survey, how is your relationship with the seismic vessel contractor and do you see Spectrum collaborating with SeaBird in the future?
Our relationship with SeaBird is excellent and we have worked successfully with them on a number of projects in the past. We certainly would have no problem with working with them in the future.
Despite the challenging market and the tumbling oil prices, Spectrum recorded a steady growth in the 2014, Multi-Client sales were up, investments more than doubled and yet the profit was slightly higher than in 2013, is Spectrum well positioned and is there space for growth in the tough year ahead of us?
Absolutely, we are cautiously optimistic. With low rates for the hiring of seismic vessels this is a great opportunity to start new projects, provided they are adequately pre-funded. For sure, some oil companies have tightened budgetary constraints but for the right projects, they are still willing to invest. It’s our job to find such projects.
It’s been a long road since 1986, when Spectrum was established, and now that seismic players slid into the red during the fourth quarter, as they fell victim to weaker seismic market, it turned out that the company made the right move when it decided to become a pure-play asset-light Multi-Client company with no long-term vessel charters or obligations. Could you comment on that?
In the current, low oil price environment, it is certainly an advantage to be asset-light. But Spectrum has become much more than a seismic acquisition company; we have a proud heritage of excellence in seismic data processing, which remains a cornerstone of our business today. Added to that are an excellent geoscience team, which is vital in uncovering new areas of underexplored or overlooked hydrocarbon prospectivity and most importantly, conveying such concepts to the market.
It has come to our knowledge that environmental organizations from Montenegro and Croatia plan to protest O&G exploration at AOG, what is your opinion on conservation groups opposing seismic surveys?
The Adriatic is a beautiful region with valuable ecosystems which need to be preserved and understandably there are concerns on the possible impact of oil and gas exploration on the environment; this is only natural and not unexpected. That said, many of the objections to hydrocarbon exploration are not always based on sound scientific evidence and raising understanding within local communities has to be a focus for the industry as a whole in order to allay any concerns. There is no reason why exploration for hydrocarbons and protecting the environment cannot continue side-by-side, as evidenced by projects in other parts of Europe and further afield. For our own part, when conducting our seismic surveys, Spectrum adheres to all regulations and in fact goes beyond industry best-practice in order to protect the flora and fauna present in the offshore environment.