FPSO staying in Scotland’s Orkney Islands for revamp ahead of redeployment to UK firm’s flagship North Sea oil project

A 2017-built floating, production, storage, and offloading (FPSO) vessel, which is destined to work on a redevelopment project operated by Aberdeen-based full-cycle energy business New European Offshore (NEO Energy), will spend up to a year in Scapa Flow, according to Orkney Harbour Authority, a division of Orkney Islands Council as the Competent Harbour Authority (CHA) responsible for the operation of the 29 piers and harbors located throughout the Orkney Islands, including Scapa Flow.

While disclosing “a major new wet storage project” in Scapa Flow, Orkney Harbour Authority explained that the Dana Petroleum-operated FPSO Western Isles ceased production earlier in the year.

Leaving behind the Harris and Barra fields on which it worked since 2017, the vessel will be in Scapa Flow for six months to a year before being redeployed to a new field and connected to five subsea production wells, supported by two water injection wells, based on the information provided by one of the UK’s most diverse commercial ports.

“Significant work is required to prepare the vessel for redeployment, involving Orcadian suppliers, engineers, and logistics companies, which will boost the local economy. This project is a fantastic showcase of Scapa Flow’s wet storage suitability with deep and sheltered waters strategically located between numerous North Sea fields and wind farms,” highlighted Orkney Harbour Authority.

Selecting the Greater Buchan Area (GBA) development solution and hand-picking the FPSO Western Isles for the project enabled the Buchan redevelopment, which is said to be the third largest pre-development field on the UK Continental Shelf (UKCS), to move forward. 

While the FPSO is owned by Dana Petroleum (operator, 76.9188%) and NEO (23.0812%), the Buchan joint venture partners, consisting of NEO Energy (50%, operator), Serica Energy (30%), and Jersey Oil & Gas (JOG) (20%), committed to acquire the interest not currently owned by NEO, upon the approval of the Buchan field development plan (FDP).

However, the GBA partners will be responsible for the costs of storing the vessel from the handover date, anticipated to be in the second half of 2024, since the unit was slated to come off-station as part of the planned cessation of production of the Western Isles fields around that time.

Upon handover to NEO, a work program will prepare the FPSO for redeployment on Buchan. Following the receipt of fiscal clarity and subject to FDP approval, major contract awards and capital commitments for the project are anticipated in 2025.

The planned activities, covering the installation of water injection booster pumps, produced water injection modifications, and preparation of the vessel for future electrification, are expected to be completed by early 2026, enabling the unit to be deployed at the field location and hooked up for the recently revised start-up of production in late 2027.

Previously, the first oil was slated for late 2026 with peak production rates of around 35,000 barrels per day. Located in the Central North Sea, the GBA project covers blocks that contain the Buchan oil field and J2 oil discovery along with the P2170 license blocks 20/5b and 21/1d, which include the Verbier oil discovery and other exploration prospects.

The total GBA acreage is estimated to contain 172 million barrels of oil equivalent (MMboe) of discovered P50 recoverable resources net in addition to the significant exploration upside potential of approximately 168 MMboe of prospective resources close to the firm’s planned Buchan facility.

While the first phase of the planned GBA work program entails the redevelopment of the Buchan field, the subsequent phases are expected to involve the tie-back of the Verbier and J2 discoveries that lie within the GBA license area and the potential for regional third-party discoveries to be tied back to the FPSO. The gross development costs for the project are estimated at £850-950 million.

The FPSO Western Isles, completed by COSCO Shipyard Group in China, has a storage capacity of 400,000 barrels of oil (bbls) and a production capacity of 44,000 barrels of oil per day (bopd). The vessel, which weighs more than 28,000 tons, features a Sevan Series 400 cylindrical monohull, along with 17 riser slots.

The planned modifications will make the FPSO electrification-ready upon its redeployment, enabling the unit to be connected to one of the anticipated third-party floating wind power developments intended to be located near the GBA, thanks to the recent Innovation and Targeted Oil & Gas (INTOG) license awards made by Crown Estate Scotland.