Total, Dong to Spend 340 Million Pounds on Shetlands Field
Total SA (FP) and partner Dong Energy A/S will spend 340 million pounds ($583 million) developing the Edradour natural gas and condensate discovery West of Shetlands that will help to revive U.K. fossil fuel production.
The field, named after a whisky like others in the area, will be linked to the nearby Glenlivit find in which Total will buy 60 percent, the company said in a statement. The sites will be tied to the Laggan-Tormore hub, with a capacity of 90,000 barrels of oil equivalent a day, due to start up this year.
The company, based outside Paris, is spending 3.3 billion pounds developing a Laggan-Tormore plant to process gas from fields in the North Atlantic. It has said the Shetland project will help it become the U.K.’s biggest producer in 2015. BP Plc, Royal Dutch Shell Plc, Chevron Corp. and ConocoPhillips are also investing in projects in the region as mature U.K. fields age.
Edradour and Glenlivit will add 65 million barrels of oil equivalent of reserves, with the former reaching a plateau of 17,000 barrels a day, Total said today. A decision on developing the Glenlivit field is “expected shortly,” the company said.
Edradour “demonstrates our focus on cost discipline,” said Patrice de Vivies, senior vice-president of exploration and production for Northern Europe. The project was put on hold last year after cost increases that were subsequently lowered.
Total has 75 percent of Edradour and Dong Energy 25 percent. The French company will have 60 percent of Glenlivit, Dong Energy 20 percent, and Faroe Petroleum (UK) Ltd. and First Oil Expro Ltd. 10 percent each, according to today’s statement.
Laggan-Tormore will be Total’s third hub in the U.K. after Alwyn and Elgin-Franklin, which was shut for almost a year after a 2012 gas leak. Total also plans to start up the West Franklin Phase 2 project this year with a 40,000 barrel-of-oil capacity.
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