Sitting in the auditorium at DEVEX 2015 last week, waiting somewhat apprehensively for my chance to tell everyone about our Pilot project (go on, click the link and watch the talk you know you really want to), I found myself listening to Neil Platt of Hurricane tell the world how Hurricane's plans for the Phase I development of Lancaster had shrunk from a multi-well development with a conventional moored FPSO down to a single well EPS (Early Production System) tied back to a DP (Dynamically Positioned) FPSO; I thought – "I know the boat you need, and it will cost virtually nothing."
I have to say, though, I really like Hurricane's new plan. The big uncertainties with Lancaster are "Where is the free water level?" and "How quickly will water get into the producers?" By going for an early production scheme using the horizontal well they drilled last year they can answer the question that really matters – how long will it take for water to rattle up the fractures in the basement reservoir? Obviously Hurricane would rather that the water slowly imbibed its way up the fractures, but the root of everyone's nervousness about Lancaster is the fear that the water will rattle rather than imbibe. So I like the plan, and the DP FPSO concept has always been appealing to me. It had been appealing to BP too in the late eighties.
So much so that they went and built one, in the Harland & Wolff shipyard in Belfast. It was called the SWOPS vessel to begin with, for Single Well Oil Production System. The project overran, both cost and schedule, I recall helping write the papers justifying the extra expense, and we learnt some important lessons, like don't put the process kit in the vessel, put it on the vessel. But when the vessel was finally launched and named the Seillean, the company didn't really love it any more and after stints on Cyrus and Donan, it was sold to Reading & Bates and went off to Brazil where it performed miracles.
On the Jubarte field it was processing heavy oil from a well in 1300 metres of water. Far beyond its original design specifications. But then Petrobras was done with her, and Transocean bought Reading & Bates, who sold her to Frontier, who got bought by Noble, who got in a legal spat with BP over a contract and laid her up next to a disused wood chip export terminal, in Mobile, Alabama.
That was where she was when, in my last company, we inspected this boat in 2013, we had even begun haggling on price, but then my investors thought they had a better idea – spoiler, they hadn't. Anyway least said about that the better.
She was in pretty good condition... Dave said "all the areas that could be safely accessed were inspected and the condition appeared to be good throughout. Significant effort has been put into preservation including greasing exposed pipe flanges, installing desiccant patches in the cabins, taping up the entrances to the accommodation and covering ventilation louvres with plastic sheeting."
OK, so that photo doesn't look brand spanking new but to an engineer like me that looks just perfect. The thrusters had been removed and of course there would need to be refurbishment but there was the bonus that we could arrange five a side football matches on the bridge, so we just had to have her. But as I said our investor had other ideas.
So we gave up the plan, a few other companies had been looking too so maybe at that stage we couldn't have got a bargain; but when I heard Neil's talk I thought I would find out what had happened to her.
Turns out, Noble had spun her off as part of the deal that created Paragon Offshore; they, sentimental souls that they are, imaginatively renamed her the Paragon FPSO1, and then in February of this year announced that they would scrap her.
Now, there are probably all sorts of reasons why this wouldn't work, like metocean conditions and so on, but if Hurricane really do want to think out of the box, if they really have thrown away the box as Neil was saying in his presentation, there is a beautiful boat on its way to the scrap yard that you could get for about $10 million. The refurbishment would probably run you another $50 million, but if there is a cheaper way to get Lancaster into production then I'm a Dutchman.
If Hurricane don't save her (and themselves about $500 million) we will just have to sing
"Ye haven't an arm, ye haven't a leg
Ye're an armless, boneless, chickenless egg
Ye'll have to be put with a bowl to beg
Oh Seillean, we hardly knew ye."