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The Pensacola natural gas discovery operated by Shell may contain nearly double the resources than initially estimated, the minority partner in the license, Deltic Energy Plc, said on Wednesday.
Drilling at the Pensacola well in the Southern North Sea began in November 2022, and in January 2023, Shell reported a gas discovery and recommended a full well testing program.
In February, Deltic Energy said, "Pensacola could represent one of the largest natural gas discoveries in the Southern North Sea in over a decade.”
Today, the company announced a significant increase in its estimate of oil and gas resources for the Pensacola discovery on Licence P2252, in which Shell holds the majority 65% interest.
Following post-well analysis, Deltic now estimates the Pensacola structure to contain gross P50 initially in place volumes of gas and oil of 342 million barrels of oil equivalent. This analysis indicates Pensacola may contain almost double the volume of recoverable gas and oil than originally thought, the company added.
Pensacola is now thought to also contain material volumes of oil, apart from natural gas. Oil is now estimated to represent around 30% of the combined recoverable hydrocarbons at Pensacola.
“Well data indicates that Pensacola contains close to double our original estimate, representing one of the most significant discoveries in the North Sea in many years,” Deltic Energy CEO Graham Swindells said.
The partners target to develop an appraisal and development program, with an appraisal well targeted for late 2024.
Despite the large discovery, current regulatory and tax conditions in the UK North Sea have made operators wary of future investments in development in the area.
The industry is already responding to the uncertain regulatory environment—the windfall tax and the pledge from the Labour Party – tipped to win the next election – to stop new oil and gas licensing in the UK North Sea. Apache, Harbour Energy, Shell, and TotalEnergies have announced either scaling back on investments and drilling, or intentions to review those.
By Charles Kennedy for Oilprice.com
Charles is a writer for Oilprice.com