Total hits the jackpot at Glendronach
Speaking after French major Total announced the Glendronach discovery, offshore West of Shetland, Kevin Swann, senior research analyst, North Sea, said: “The Glendronach discovery is big news for Total, its partners INEOS and SSE, and for the UK as a whole.
“With an estimated recoverable resource of 1 trillion cubic feet of gas (176 million barrels of oil equivalent), it is the largest conventional discovery in the UK since Culzean in 2008. It could contribute as much as 10% of the UK's annual gas production in its early years.
“The discovery is close to Edradour, part of Total’s flagship Laggan-Tormore development, which means it will be able to use the infrastructure already in place to bring on production quickly and cheaply. It will double the remaining reserves at the Laggan-Tormore area, boosting value and returns substantially.”
Mr Swann added: “Exploration in the UK has been a huge concern so far in 2018 with just five exploration wells spudded to date – on track for lowest levels of activity since the 1960s. So this discovery is welcome news, even if there is more work to do if the UK is to fill the project gap that is set to arise in the next few years. The cupboard is pretty bare beyond 2020.
“West of Shetland is now the key area for growth in the UK. The region is core for BP, Shell, Total and Chevron, and we already expect large development projects to boost production from the region through to the mid-2020s. But the region is also underexplored. The exciting Lyon and Blackrock prospects will be drilled next year, and material discoveries like Glendronach will whet the appetites of those looking to invest.”