Duo Developing First UK Offshore Wind Powered Oil Platform

Duo Developing First UK Offshore Wind Powered Oil Platform
Cerulean Winds and Ping Petroleum UK have signed an agreement to create one of the UK's first offshore oil and gas facilities powered by offshore wind.

Cerulean Winds and Ping Petroleum UK have signed an agreement to create one of the UK’s first offshore oil and gas facilities powered by offshore wind.

Under the agreement signed in a meeting hosted by the UK’s 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 floating offshore wind.

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 remove up to 20,000 metric tons of CO2 emissions every year from the offshore production facility.

The project will demonstrate the use of floating offshore wind in decarbonizing oil and gas production. Later this summer, applications will open to developers for seabed leases to drive the decarbonization of other oil and gas assets across the North Sea.

Ping Petroleum UK acquired a 100 percent stake in the Avalon site in August 2021, with production expected to begin in 2025. The field has a total estimated recovery of 23 million barrels of oil. The proposed development concept for the plans has already been cleared by the North Sea Transition Authority, and a field development plan will be submitted later this year.

Under these plans, Cerulean Winds with its partners will provide a large floating offshore wind turbine which will be connected via cable to Ping Petroleum’s FPS vessel.

This will be one of the largest floating wind turbines built in the UK and will provide most of the power required by the production and 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. The production vessel has a storage capacity of 270,000 barrels of oil and can produce up to 30,000 barrels of oil per day.

As part of the agreement with Ping, Cerulean Winds committed to fully manufacturing and assembling the offshore wind turbine in the UK. The project is expected to realize between $100-120 million in investment in the development and the UK’s renewable energy supply chain.

The project was enabled by a grant to Cerulean Winds through the Floating Offshore Wind Demonstration Program from the UK Government’s Department of Business, Energy, and Industrial Strategy (BEIS) to support the innovation and optimization of the technology that will be deployed.

“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 greenfield project, Avalon. This project which uses offshore wind to power operations demonstrates our long-term commitment to establishing 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 financial performance,” Tan Sri Syed Zainal Abidin Syed Mohamed Tahir, Group Managing Director of DNeX, said.

“Our partnership marks a significant milestone for the oil and gas industry in creating one of the UK’s first production facilities to be powered by clean, green, and affordable offshore wind energy. This project will demonstrate how we can harness the power of affordable, offshore wind to deliver significant 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 floating offshore wind technologies to support industrial decarbonization,” Dan Jackson, Founding Director of Cerulean Winds, stated.

This important step in progressing the Avalon project was also welcomed by the UK Government and its Business and Energy Secretary.

“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 the security of supply as we transition to clean, affordable, home-grown energy. In the meantime, we need to cut emissions from production. Platform electrification 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 commitments of the landmark North Sea Transition Deal,” Kwarteng said.

To contact the author, email bojan.lepic@rigzone.com

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