24th November 2017

‘More than 30 years life in West of Shetland gas fields’

One of the firms involved in exploiting North Sea gas reserves believes it has “cracked the code West of Shetland”.

Top personnel from Dong Energy were in the isles today for a visit to Shetland Gas Plant, which will process gas from the Laggan-Tormore fields.

Simon Slater , Brent Cheshire and Soren Gath Hansen Dong Energy UK. Photo: Dave Donaldson

Simon Slater , Brent Cheshire and Soren Gath Hansen Dong Energy UK. Photo: Dave Donaldson

The Danish company says its aim is to double its levels of exploration and production this decade and it believes there are enough reserves to go beyond the forecast 30-year life of the Laggan-Tormore project.

Dong is a 20 per cent partner in the project, which includes the gas processing plant, with Total holding the remaining 80 per cent. Together the oil firms want to exploit the Laggan and Tormore fields they believe represent the “future of the UK oil and gas industry”, on the edge of the UK continental shelf.

Engineers will have to contend with the “uniquely challenging” water depths of up to 600m, but iit there is great potential in the fields, 125km north-west of Shetland. The gas will be piped from LAggan and Tormore to the gas plant.

Dong Director Soren Gath Hansen said the project, the firm’s first in the UK, will be very important to the Shetland economy, but also to the broader UK economy. Between 17 to 20 per cent of the UK’s oil and gas resources are “locked” in the West of Shetland fields.

Work at the Shetland Gas Plant is due to be completed by the middle of next year. Photo: Dave Donaldson

Work at the Shetland Gas Plant is due to be completed by the middle of next year. Photo: Dave Donaldson

He said Dong is one of northern Europe’s leading energy companies, operating also in Faroe, Norway and Greenland, and one of the largest licence holders West of Shetland. It aims to double its exploration and production this decade. The Glenlivet gas field, which Dong owns the rights for, is set to be linked with the Laggan-Tormore pipeline.

There have been other “significant finds” in the area, and, he said: “We believe we have cracked the code West of Shetland.”

Dong UK chairman Brent Cheshire said Shetland Gas Plant (SGP) would “unlock” the “gas cluster” in this area, with Laggan-Tormore as a hub. He said: “It’s a very worthwhile area to operate in because of the materiality in the wells.”

Dong UK director of assets and facilities Simon Slater said of the SGP: “It’s strategically important to the energy mix of the UK and the future of Dong.” The “new frontiers” of wells to operate in the future would add to this.

He added: “Dong is seeking to double its exploration and production by 2020. Laggan-Tormore and SGP are key areas which will give us our first UK production in the near term, and in the long term be an enabler for the tie-back of existing discoveries. It’s a vital piece of infrastructure, it’s a challenging project but we’re very happy with the relationship with Total and with progress.”

Construction of the gas plant started in 2010 and is now 75 per cent complete. It is due to be finished on time, with the first gas flowing in the middle of next year.

The cost of the Laggan-Tormore project, including the SGP, stands at £3.3 billion. While that is significantly higher than the original estimated £2.5 billion it has not risen since April when reporters last toured the plant.

Another huge piece of equipment is manoeuvred   by a worker. Photo: Dave Donaldson

Another huge piece of equipment is manoeuvred by a worker. Photo: Dave Donaldson

The project is estimated to have a 30-year lifespan, which could be extended as gas from other as yet undeveloped fields comes ashore. The workforce is now 1,300, and is due to peak at 1,400 shortly, with another accommodation flotel due to arrive this month.

Gas, together with light oil known as condensate, will be piped 143-km from Laggan-Tormore, at 600-metres the deepest wells in the UK, into the gas plant. The liquid condensate will be removed there and piped to BP for storage and eventual export. The natural gas will be exported to St Fergus, near Peterhead, for final processing before entering the national grid.

About Rosalind Griffiths

I am a Shetland Times reporter covering news, including health stories, and features. I have been in Shetland for more than 30 years.

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4 comments

  1. Johan Adamson

    This is great, and I am sure safety is at the forefront of everything which is being done. I would like to know if it is possible for Shetlanders to benefit in any way from all this as we seem to have all this natural gas and oil yet still pay the most for fuel because it is cold here and rural.

    Reply
  2. Ali Inkster

    Maybe if our glorious leaders did more to get our young men and women working in the oil industry that is around our shores instead of squandering money on the arts, we would benefit more from these opportunities. I like most folk like a bit of music and am quite willing to pay for what I like and as everyone’s tastes are different between us we will support the arts that are worth supporting.
    We should be insisting on Unst airport being opened and funded solely by the oil industry as the shortest flight time to the northern fields by helicopter is from there.
    Scatsta to remain to service Sullom and the gas plant and Sumburgh to service the fields further south.
    Apprenticeships for youngsters not just on shore in the process side but offshore on the platforms.
    30 years more like 60+ years of oil and gas out there but will they grasp this opportunity with both hands or squander it like the last 30 odd years.
    What do you think?
    Some folk up here are under the impression that we negotiated a good deal all those years ago but any oil industry executive that I’ve spoken to reckons we were screwed good and proper, the money paid out was peanuts compared to what the oil companies were willing to pay. And let’s be honest did not even cover our costs in building houses and infrastructure to accommodate them.
    I have travelled the world at the expense of the oil industry and have been witness over the last 25 years to the changes that can be brought to places by the oil industries arrival and I can assure your readers we have not done very well out of it at all.

    Reply
  3. Jimmy Nicolson

    Good news for Shetland, now if the councillers can secure a good financial deal for Shetland as Chief Executive Ian Clark did decades ago the future should be prosperous. Oil and gas is what should be the focus for a strong Shetland future, not a certain project involving wind which would have a detrimental effect for so many different reasons, time for councillers to realise this.

    Reply
  4. desmond fyfe

    I worked on the gas plant for agency for morrisons construction for 2 year been off shetlands for 3 weeks working was great plenty of hours 7 days a week could not complain .I have my doubts if gas will be flowing for 2014 nae chance the job will still be in construction for a long time the job is miss managed by the company that total gave the contract too petrofac what a firm not got a clue .morrisons was fine so was total .the whole problem with the job is accommodation men sitting at home because nae beds available .not enough flights .yes they have barges but they aint for the likes of me they are for upper management/ secretarys /rtc thet had sent workers to unist nae place else to send the guys .they should have sat round a table and discussed the accommodation first before anything else .maybe if they ever get another job 1 hopefuly they will get the accommodation right .

    Reply

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