Oil & Gas UK: Kraken Proves North Sea Has a Lot to Offer
Oil & Gas UK has welcomed the announcement that EnQuest’s Kraken development is to go ahead, a project set to recover around 140 million barrels of oil from the North Sea, secure thousands of jobs and generate billions of pounds of revenue for the Treasury over the next 25 years.
The project, EnQuest’s sixth production hub in the UK North Sea, will benefit from heavy oil allowances which the Government has provided to stimulate investment in the UK North Sea.
Oil & Gas UK operations director Oonagh Werngren said:
“This is yet another clear sign that opportunity remains in the North Sea. This project reiterates the importance of the measures that need to be taken to secure the continued success of our industry.
“The Kraken project, the largest investment announced in the UK North Sea this year – and one of the largest industrial investments of 2013 – is an example of how Government tax allowances are working to stimulate activity on the UK Continental Shelf (UKCS). In bringing forward a particularly challenging heavy oil development, it is also a reflection on how the industry can respond to a stable and predictable business environment.
“Development of Kraken will secure a significant number of jobs for the UK, provide a valuable source of primary energy to enhance our security of supply and generate tax revenues for the Treasury, which is all very much to be welcomed.”
EnQuest is the operator of the Kraken development. EnQuest’s partners on the development have also given their approval for the project to proceed. The field development will consist of 25 wells, tied back to the vessel.
The oil is ‘heavy oil’ and the development has two separate heavy oil fields, both of which will attract heavy oil allowances; the Government has put a series of such investments in place to stimulate investment in the UK North Sea. Kraken is a large heavy oil accumulation in the UK North Sea, located in the East Shetland basin, to the west of the North Viking Graben; approximately 125 km east of the Shetland Islands. EnQuest has a 60% interest in Kraken, its partners in the Kraken development are Cairn Energy PLC and First Oil plc.
Press Release, November 18, 2013