Relinquishment Report for License P.1921 Blocks 12/18 & 12/19c · Seismic data is generally good...

Relinquishment Report

for License P.1921

Blocks 12/18 & 12/19c (End of Initial Term)

May 2014

Adriatic Oil Plc

Licence P.1921, Blocks 12/18 & 19c - Relinquishment Report of 13

CONTENTS

1.0 Licence Information 2.0 Licence Synopsis 3.0 Work Programme Summary 4.0 Prospectivity Update 4.1 Interpretation 4.2 Further Technical Work 5.0 Conclusions 6.0 Clearance

LIST OF FIGURES Figure 1: Prospect Map Figure 2: 3D seismic coverage Figure 3: Arbitrary seismic line to well tie Figure 4: TWT Structure mid Jurassic horizon Figure 5: Mid Jurassic TWT Structure map Figure 6: Comparison of amplitude and inversion data Figure 7: BCU TWT Structure map Figure 8: Rotliegendes TWT Structure map Figure 9: Time, Max Amp and ADF maps at Top Middle Jurassic

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1.0 Licence Information

License Number: P.1921

License Round: 26th Round

License Type: Promote

Block Numbers: 12/18 and 12/19c

All permissions have been obtained to allow publication of this report by DECC.

2.0 License Synopsis

Blocks 12/18 and 12/19c (Promote License P.1921) were awarded to Elixir Petroleum (100%) in

the 26th UKCS Offshore Licencing Round. Elixir obtained the available 3D seismic survey data

for a preliminary evaluation of the Middle Jurassic Sunset Prospect, identified initially during

Elixir’s pre-award regional studies, and to identify any other undrilled Upper Jurassic

prospectivity. Subsequent to award Adriatic Oil Plc farmed into the license and became the

Licence Administrator holding 80% equity in the Licence.

Following interpretation of conventionally processed 3D seismic, it was concluded that no

significant undrilled Upper Jurassic structural closures in 12/18 and 19c could be identified

and that the Sunset Prospect although having low risk on Beatrice sand reservoir presence, did

not display any seismic characteristics that would indicate a stratigraphic trap is present.

Furthermore, based on the rather uniform seismic character of the Beatrice, it is thought

unlikely that inversion using this 3D data set would reproduce the evidence of the facies

change presented on the inverted 2D seismic data used to support the stratigraphic

closure to the Sunset Prospect in the original application for these blocks.

Following an equity reorganization on the license and change of Licence Administrator from

Elixir to Adriatic further processing of the 3D data was undertaken in the Frequency Domain in

an attempt to identify stratigraphic trapping potential. No significant frequency anomalies were

however identified in the Jurassic section. Frequency anomalies were noted in deeper section

but the onset of license expiry precluded any further analytical work on these.

A case for an upside structural closure for the Sunset Prospect however can be made, although

the crest of this tilted fault-block trap occurs to the east in Block 12/19b and high-risk fault

seal or shale-out of the sands is required to the form the trap to the west, in order to separate

Sunset from the 12/23-1 well which was dry.

Following the extensive technical review of the blocks, no viable drilling candidate could be

identified which ultimately led to the Group decision to relinquish the license and the license

expired with effect on 12th February 2014.

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3.0 Work Programme Summary

The firm commitment made on application was to obtain 250km2 of 3D seismic data. The

principal seismic data used in the license evaluation consists of the Petro-Canada 3D survey,

acquired in 2006 which covers approximately 1250km2. A sub-set of this data, 250km2, was

also re-processed in the frequency domain by Apex Spectral which was not part of the license

commitment.

4.0 Prospectivity Update

Play concepts and pre-application interpretation

A single large stratigraphic prospect MJB1 (subsequently renamed Sunset Prospect) was

identified for the 26th Round in the Middle Jurassic Beatrice Formation on the northern edge of

the Smith Bank High (Figure 1). The prospect was identified on 2D seismic data with the sands predicted to laterally pinch out by facies change into deeper water Heather Formation shales. The prospect has been identified as an acoustic impedance anomaly on several lines. Reservoirs, seals and source rocks were assumed to be the same as those found at the Beatrice Field. The nature of trapping however is significantly different with the Sunset Prospect interpreted to be a stratigraphic trap created by a change from typical Beatrice shallow-marine sandstone facies into deeper water Heather Formation shales.

Source rocks were predicted to be present to the north in the Caithness Basin where they have

been buried to a depth of up to 3.5 km. Migration of the oil from the Kimmeridge Clay

Formation would be straightforward as it is juxtaposed against the Beatrice sand by the main

northerly Smith Bank fault. Migration from the other source horizons (Brora, Heather and

Devonian) would depend on up-dip migration via the main northerly fault bounding system.

.

Figure 1: Sunset Prospect map based on 2D seismic data

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Seismic Interpretation

Data coverage

The seismic data covers the whole licensed area except for a 1600 metre-wide strip along the

northern edge of Block 12/18 (Figure 2). The 3D seismic coverage also extends across 12/20,

21, 22, 23, 24 & 28, but the full interpretation only includes the P.1921 Licence.

Figure 2: 3D Seismic Coverage, Blocks 12/18 and 12/19c outlined in red

Seismic data is generally good quality although the interpretation of the detail of the Jurassic

section becomes uncertain to the east of Block 12/19, partly because this section significantly

thins.

Well Ties

Within the licenses, well 12/18-1 is the only Jurassic tie to the 3D seismic, but this well is of

limited value and is a poor tie as it is situated in a zone of steep southward dip at the

northern extremity of the seismic data along the median fault of the Wick Basin. Wells to the

south of 12/18 & 19 are either situated at the southern edge of the Smith Bank High

penetrating a reduced Jurassic section, or within the Smith Bank Basin. Well 12/17-1 which

lies to the west, outside the 3D coverage, ties a 2D line in the Elixir database. However the TD

of this well is relatively shallow within the Kimmeridgian.

Based on the tie to 12/23-1 on the Smith Bank High (Figure 3), there is reasonable confidence

on the Middle Jurassic, Base Cretaceous, Top Zechstein and Top Rotliegendes seismic picks.

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Owing to the reduced Upper Jurassic thickness at the well location, the intra-Upper Jurassic

picks are less confident, but a pick on the Top Beatrice in the well can be made based on

consistent seismic character. If this tie is correct, then the Sunset Prospect has good evidence

for the presence of Beatrice sands and a reasonable thickness of Heather Formation which

could form a top-seal to the Beatrice, but this is eroded into by a prominent unconformity

identified as Intra-Kimmeridgian in age. This unconformity is a risk to the Sunset Prospect top-

seal as it erodes nearly to the Beatrice at the well and is overlain by a Kimmeridgian-aged

sandstone.

Figure 3: Arbitrary 3D seismic Line across the Smith Bank High with tie to well 12/23-1

Figure 3 illustrates the tie to 12/23-1 and the structure in the dip direction across the Smith

Bank High with the major faults to the north and south downthrowing into the Wick Basin and

Smith Bank Basin, respectively.

4.1 Interpretation

The interpretation concentrated on the mid Jurassic seismic pick as it forms the base of the

principal reservoir target (the Beatrice sands) and is a reasonably consistent pick within the

dataset. Other seismic events were also picked (see Section 3.2) but were not interpreted

with the same level of detail as the mid Jurassic.

The mid Jurassic event was mapped throughout the licensed blocks and southwards to the

southern margin of the Smith Bank High. The proposed top of the Beatrice sand (mid-Jurassic

sand pick in Figure 3) was mapped over a similar area except it was not followed into the Wick

Basin in the northern part of Blocks 12/18 & 19 as the character associated with the interval

between the top and base of this sand did not continue into the Wick Basin.

Sunset

Top Beatrice

N 12/23 S

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The structural mapping of the mid-Jurassic event (Figure 4) demonstrates an absence of

significant untested closures. Well 12/18-1 has tested the highest point along the median fault

in the Wick Basin, and although outside the blocks, wells 12/23-1 and 12/23-2 appear to have

tested valid structural closures related to the Smith Bank High.

Figure 4: TWT Structure mid Jurassic horizon

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There are minor closures in Block 12/19c located on the saddle between the Wick Basin and

Smith Bank Basin (Figure 5). These closures are located on the downthrown sides of

extensional faults and have limited amounts of vertical closure.

Figure 5: Block 12/19c detail of the mid Jurassic TWT Structure showing the small

downthrown closures

Whilst the mapping at mid-Jurassic is at approximately the base of the Beatrice sand, it is

unlikely that the structure at Top Sand will differ appreciably from the structure at this mid

Jurassic event.

A key element of the Sunset Prospect as mapped for the 26th Round application was that the

2D inversion data indicated the potential for stratigraphic trapping in the Beatrice where an

updip facies change to Heather Formation shales was implied from the acoustic impedance

data (Figure 6). Comparison of the 2D amplitude data, the inversion of that data and the

amplitude 3D data suggests that the facies change inferred from the 2D inversion is most

likely an artefact within the 2D data. In particular, the poor imaging of the 2D seismic in the

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hangingwall of the blue fault in Figure 6 may have impacted the quality and reliability of the

acoustic impedance inversion for facies analysis.

Figure 6: Comparison of Amplitude and Inverted data for Line IMF-226 and Amplitude 3D Line

The lack of support for a facies change in the Beatrice sands requires that a different trapping

mechanism is postulated for the Sunset Prospect. For such a trap to work, the Beatrice in the

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Sunset Prospect would have to be separated from the dry Beatrice sands in the 12/23-1 well.

This is feasible by invoking seal along the network of northwest-trending faults to the north of

well 12/23-1 (Figure 4), and invoking a footwall closure on the Smith Bank High. However,

continuous faults are limited in extent and a potential trap only occurs down to approximately

1.25 seconds TWT on the structure map in Figure 4, much reducing the aerial extent of the

Sunset Prospect and shifting the bulk of the closure eastwards into blocks 12/19b and 12/20.

This closure may be worth pursuing, but it is recognised that similar prospects were drilled

with wells 12/23-1 and 12/23-2 and 13/16a-1 without success.

An alternative trapping mechanism could invoke a facies change to Heather Formation shale in

approximately the same location as the faults. Support for this facies change is not obvious on

the amplitude data and to investigate further would require inverting a large volume of the 3D

data.

Figure 7: Base Cretaceous Unconformity TWT structure

Although interpreted in less detail than the mid Jurassic, the maps of the Base Cretaceous

Unconformity (Figure 7) and Rotliegendes (Figure 8) show there are no significant closures

within the blocks at these levels.

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Figure 8: TWT structure at Rotliegendes

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4.2 Further Technical Work

A 250km2 subset of the PetroCanada 3D survey was selected for re-processing in the

frequency domain for ADF® DHI's between 800 and 1800ms, essentially covering the

primary exploration targets in the Middle and Upper Jurassic sedimentary sequences.

The processing was conducted by Apex Spectral and preliminary results received in

November 2013 and subsequently finalised in Dec 2014.

Aside from a 1.1 sq km lead identified at the eastern most edge of the re-processed data

the analysis indicated that the primary target interval was devoid of ADF® DHI's (Figure

9). Several leads were identified at deeper stratigraphic levels however the combination

of requiring a larger area to be processed to evaluate these and the imminent end of the

initial period on the license resulted in a lack of time to evaluate these leads further.

Figure 9: Time, Max Amp and ADF maps at Top Middle Jurassic

5.0 Conclusions

There are no significant undrilled Middle and Upper Jurassic structural closures in blocks

12/18 and 12/19c.

Based on the 3D amplitude and frequency data, there is little support for the

stratigraphic trap previously proposed for the Sunset Prospect although the 3D tie to

well 12/23-1 indicates the probable presence of Beatrice sands in the vicinity of the

Sunset Prospect.

A different trap mechanism must be sought for the Sunset Prospect perhaps invoking

fault seal or facies change to the west.

If the fault seal model is invoked it implies a larger footwall closure may be feasible for

the Sunset Prospect, but the bulk of the closure lies to the east in blocks 12/19b and

12/20.

Similar prospects have already been drilled without success with wells 12/23-1, 12/23-

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2 and 13/16a-1, and the Sunset Prospect would consequently be considered extremely

high risk.

It appears unlikely that further analysis of the 3D seismic data would resurrect the

stratigraphic trap for the Sunset Prospect identified in the 26th Round application. However, such further work in the frequency domain may identify other stratigraphic traps within these blocks. These could be within the Middle Jurassic section which thins dramatically updip southwards towards the southern margin of the Smith Bank High or within the Kimmeridgian where reflectors onlap the Base Kimmeridgian Unconformity on the northern margin of the Smith Bank High or in deeper horizons.

6.0 Clearance Adriatic Oil, and co-venture partner Elixir Petroleum, confirm that DECC is clear to publish this relinquishment report

Relinquishment Report for License P.1921 Blocks 12/18 & 12/19c · Seismic data is generally good...

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