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Wind-powered oil and gas production facilities
Recently, Cerulean Winds and Ping Petroleum UK have signed an agreement to create one of the UK’s frst oil and gas facilities powered mainly by ofshore wind.
Under this agreement, signed in a meeting hosted by Secretary of State Kwasi Kwarteng, the production facility at Ping Petroleum’s Avalon site, located in the UK Central North Sea, will be mainly powered by foating ofshore wind.
20,000t of CO2
The pioneering project will help meet the emissions reduction targets agreed between government and industry in the North Sea Transition Deal in March 2021. The provision of wind power will reduce annual CO2 emissions by 20,000t. The project will demonstrate the use of foating ofshore wind in decarbonising oil and gas production. Later this summer, applications will open to developers for seabed leases to drive the decarbonisation of other oil and gas assets across the North Sea.
Exceeding energy needs
Ping Petroleum UK acquired a 100% stake in the Avalon site in August 2021, with production expected to begin in 2025. The feld has a total estimated recovery of 23 million barrels of oil. The proposed development concept for the plans have already been cleared by the North Sea Transition Authority (NTSA), and a feld development plan is to be submitted later this year. Under these plans, Cerulean Winds with its consortium of Tier 1 industrial partners will provide a large foating ofshore wind turbine which will be connected, via a cable, to Ping Petroleum’s Floating Production & Storage vessel. The foating turbine will be one of the largest foating wind turbines built in the UK and will provide the majority of power required by the production & storage vessel. It is expected that green power produced by the turbine will exceed the energy needs of the production vessel, with the partners exploring options to supply excess energy to other nearby production facilities.
Avalon feld
Image courtesy of North Sea Transition Authority.
Ping Petroleum’s Avalon site is located in the UK Central North Sea.
BEIS Grant
As part of the agreement with Ping, Cerulean Winds have committed to fully manufacturing and assembling the ofshore wind turbine in the UK. The project is expected to realise between USD 97-121 million in investment in the development and in the UK’s renewable energy supply chain. The project was enabled by a grant to Cerulean Winds through the Floating Ofshore Wind Demonstration Programme from the UK Government’s Department of Business, Energy, and Industrial Strategy (BEIS) to support the innovation and optimisation of the technology that will be deployed. Business and Energy Secretary Kwasi Kwarteng states, “The North Sea oil and gas sector has been a major British industrial success story for decades. We must keep supporting production on the UK Continental Shelf for security of supply as we transition to clean, afordable, home-grown energy. In the meantime, we need to cut emissions from production. Platform electrifcation projects such as this are a welcome step forward to reduce emissions from oil and gas production, secure jobs and new skills and deliver on the
Photo courtesy of DNeX.
Seated left to right: Zainal Abidin Jalil, Executive Director of DNeX and also Managing Director of Ping Petroleum; Dan Jackson, Founding Director of Cerulean Winds. Standing left to right: Kwasi Kwarteng, Secretary of State for Business, Energy and Industrial Strategy, Government of UK; Dato’ Robert Fisher, Director of DNeX and Chairman of Ping Petroleum; Tan Sri Syed Zainal Abidin Syed Mohamed Tahir, Group Managing Director of DNeX.
commitments of the landmark North Sea Transition Deal.”
Milestone
Dan Jackson, Founding Director of Cerulean Winds, says, “Our partnership marks a signifcant milestone for the oil & gas industry in creating one of the UK’s frst production facilities to be powered by clean, green and afordable ofshore wind energy. This innovative and pioneering project will be ‘Made in the UK’ and through our delivery partners, we will be realising signifcant investment in UK fabrication yards and ports. This is a critical step in scaling the UK supply chain and building experience and a track-record to exploit future opportunities in the fabrication, assembly, and servicing of ofshore wind developments. This project will demonstrate how we can harness the power of afordable, ofshore wind to deliver signifcant reductions in the carbon emissions of oil and gas production. The UK has a golden opportunity to make our domestic oil and gas production the cleanest in the world – scaling the green economy and creating thousands of jobs in the process. We are thankful to BEIS for encouraging research and development which highlights to potential investors that the UK Government endorses the rapid development of integrated foating ofshore wind technologies to support industrial decarbonisation.”
Early implementor
Tan Sri Syed Zainal Abidin Syed Mohamed Tahir, Group Managing Director of Ping Petroleum UK’s parenting company DNeX, says, “As the world transitions to a low-carbon future, Ping is excited to be an early implementor of this revolutionary technology in the UK North Sea for our new greenfeld project, Avalon. This project which uses ofshore wind to power operations demonstrates our long-term commitment to establish >>
Photo courtesy of DNeX.
For the Avalon project, Ping acquired the FPSO Sevan Hummingbird from the marine energy transportation company Teekay Corporation, which was renamed Excalibur recently.
This project which uses ofshore wind to power operations demonstrates our long-term commitment to establish a low carbon development concept.
a low carbon development concept. It will substantially lower the emissions intensity of our operations which supports long term climate change goals globally. In addition, it enables us to seize market opportunities arising from the energy sector’s low-carbon transformation and development. The creation of an additional revenue stream via the supply of excess energy to nearby facilities will positively contribute to our fnancial performance. Furthermore, we will gain experience and exposure to the relevant markets and stakeholders within the renewable energy sector which may lead to strategic business developments ahead.”
Excalibur
For the Avalon project, Ping acquired the FPSO Sevan Hummingbird from the marine energy transportation company Teekay Corporation, in early July this year. Recently the FPSO was renamed Excalibur in the Port of Nigg, Scotland (UK). First commissioned in 2008, the Excalibur spans 60m in diameter with a storage capacity of 270,000 barrels of oil. It can produce about 25,000 barrels per day, supported by up to 47 ofshore personnel. “We are proud to be the new asset owner and ready to progress in our maiden greenfeld upstream project, starting on a clean slate in line with DNeX’s and Ping’s growth strategies. Representation from DNeX being present at the event demonstrates the Group’s continued commitment in this project. DNeX and Ping are upbeat about the prospect of Avalon Development”, Mr Tahir says.
