Offshore projects in the Black Sea

Offshore projects in the Black Sea

In preparation for the 7th Black Sea Oil & Gas in October, Globuc prepared an overview of the largest offshore projects in the Black Sea region. To get updates on the most important news about these projects and the industry –sign up for our newsletter.

Midia Gas Development Project

  • INVESTMENT $400m
  • RESERVES 320 billion cubic feet (bcf)

The Midia Gas Development (MGD) project involves the Ana and Doina discoveries, located in the XV Midia Shallow block in the Romanian Black Sea.

The sites are being developed by a fully-owned subsidiary of Carlyle International Energy Partners (CIEP) known as Black Sea Oil & Gas (BSOG, 65%) in cooperation with Gas Plus International (15%) and Petro Ventures Europe (20%). BSOG is acting as the operator of the project.

The project is estimated to cost $400m and the final investment decision was executed in February 2019. Construction is underway, with completion scheduled for Q1 2021.

Plans outlined for the Midia Gas Development (MGD) project include the design and construction of an offshore platform to produce gas from the two fields, in addition to offshore and onshore pipelines, drill/development wells and a gas treatment plant.

A well-head platform (jacket) will be constructed close to the Ana field at a water depth of 69.5m. It will also support production for the Doina subsea well, which will be connected to the platform through an 18km in-field pipeline.

Another 121km offshore pipeline will be laid from the Ana platform to the shore to facilitate the transportation of gas.

Gas produced at the plant will be sent to a gas treatment plant (GTP) through a 4.1km underground pipeline, which is under construction in the Vadu area.

The plant will be connected to a Transgaz-operated national transmission system (NTS) via a 25km-long onshore pipeline.

South Akcakoca Sub-Basin Gas Field

  • PROJECT TYPE  Shallow-water gas field redevelopment  
  • FIRST PRODUCTION  Phase one: 2007, Phase two: 2011

South Akcakoca Sub-Basin (SASB) gas field is one of the biggest natural gas production and development projects located in the Black Sea, offshore Turkey, at a water depth of less than 100m.

Trillion Energy, a company based in Canada, came to own an interest in the project through the acquisition of Park Place Energy Turkey (PPETL), which owned 36.75% interest in the SASB, in 2017. Trillion Energy acquired a further 12.25% working interest in the project in January 2018 to increase its total working interest to 49%. Türkiye Petrolleri Anonim Ortaklığı (TPAO) owns the remaining 51% stake in the field.

PPETL commenced production from phases one and two of the SASB between 2007 and 2011, while Trillion Energy plans to develop the third and fourth phases from 2020 to 2022.

Development of the first two phases of the SASB gas project involved an investment of $608m.

The SASB gas field infrastructure includes 23 wells and four offshore unmanned wellhead platforms namely Ayazli at 78.5m of water depth, Dogu Ayazli at 70.5m of water depth, Akkaya at 61m, Akcakoca at 94.5m, associated pipelines, and Cayagzi onshore gas processing plant.

The initial phase of development included the drilling of 17 wells to a total depth of 1,500m below the seabed to undertake partial development of the Ayazli, Akkaya, and Dogu Ayazli gas fields.

The Akcakoca field, discovered in 2006, was developed through the drilling of six wells in phase two of the project and commenced production in 2011.

All the platforms are connected to the shared processing facilities at Cayagzi gas plant via a 25km-long and 12in diameter pipeline. The plant can process up to 75mcf of gas a day.

The processed gas is transported via an 18.6km-long and 16in diameter onshore pipeline, which is tied-back to the national gas transmission network operated by state-owned BOTAS Petroleum Pipeline Corporation.

Neptun Deep Gas Field Project

  • PROJECT TYPE Deep-water gas field development
  • RESERVES 42 to 84 billion cubic metres

Neptun Deep is a deep-water offshore gas field development project located in the Romanian deep-water sector of the Black Sea, in water depths between 100m and 1,700m.

The gas field is being jointly developed by OMV Petrom (50%) and ExxonMobil Exploration and Production Romania (50%, operator).

In 2000, the Romanian Government made a concession agreement with OMV Petrom and ExxonMobil to explore and develop the Neptun Deep natural gas perimeter in the Black Sea until 2030. The government extended the agreement until 2045 in January 2019.

OMV Petrom formed a joint venture with ExxonMobil for the exploration of Neptun Deep in November 2008. A final investment decision on the project is yet to be made and the project is facing delays caused by changes in the tax and legal structure of Romania.

ExxonMobil announced its decision to exit the project in 2019 citing the regulatory changes in the country and low oil and gas prices globally. The company invested approximately $700m in project development.

ExxonMobil acquired over 3,000km² of three-dimensional (3D) seismic data over Neptun Deep Block between 2009 and 2010. The drilling activities in the Neptun Block began by the end of 2011.

In 2012, the Domino-1 exploration well was drilled in 1,000m deep water approximately 170km off the coast of Romania.

The well encountered 70.7m of net gas pay and confirmed the presence of natural gas in the deep-water sector of the block.

Based on initial estimates, the Domino-1 well was expected to produce approximately 630 million cubic feet per day (Mmcfd) of gas. A seven-month 3D seismic study covering an area of 6000km² in the block was completed in 2013.

In 2014, the second well, Domino-2, was drilled in a water depth of approximately 800m, nearly 200km offshore Romania using Ocean Endeavor rig. The rig also drilled the Pelican South-1 wildcat well approximately 155km offshore to evaluate a new geological structure on the Neptune Block.

A second exploration drilling programme was completed in January 2016. A total of seven wells were drilled during the campaign and most of them encountered gas. Extensive engineering work was performed in 2017.

OMV and ExxonMobil invested more than $1.5bn in exploration and appraisal activities in the block during the period between 2008 and 2016.

Trident Block EX-30 Trident

Four years ago, the companies running this offshore perimeter announced an important gas discovery, estimated at some 30 billion cubic meters. If confirmed, this discovery could cover Romania’s whole gas consumption for about three years.

Lukoil Overseas, a subsidiary of the Russian group, has asked for environmental permits to drill three wells in the Trident perimeter, local reported.1

This would be the biggest such operation after the gas discovery was announced three years ago. In the meantime, only seismic prospecting was performed in the area. However, exploration wells are a more efficient tool to assess the viability of the gas discovery.

In 2015, Romgaz has announced that the first exploration phase indicated a potential gas deposit of around 30 billion cubic meters of gas in Trident block.

In 2018 Russia’s Lukoil and Romania’s Romgaz, partners in joint offshore operation in the Black Sea, prepare to drill for an exploration well in estimated 30 billion cubic meters deposit Trident.

In 2019 Lukoil successfully completed another stage of its exploratory work at the EX-30 Trident Block in Romania’s section of the Black Sea.2 The company drilled its third exploratory well – Trinity-1X on the block

In January 2020 The National Gas Company Romgaz SA and Grup Servicii Petroliere (GSP) have announced the start of operations within Trinity-1X project, in Trident Block, located in Romania’s Black Sea territorial waters, in early November. The gas resource is estimated at approximately 30bcm, and the two partners, Lukoil and Romgaz (which owns a 12.2% stake in the project) will operate the well, with the help of GSP and Italy’s Saipem.

Trinity-1X well, at a distance of 215km off the coast of Constanta City, is the 3rd exploration well to be drilled in Romania within EX-30 Trident Block, water depth reaching in the exploration area 1,076m and the proposed well depth being 2,975m. Drilling of the exploration well will be followed by the detailed analysis and professional evaluation of the results obtained, and by integrating the new information the new geological model will underlie the future decisions whether to drill new wells or not; depending on data obtained, a final investment decision can be made to move to the field development phase.

“It is a great success from my point of view and we hope it precedes other important achievements in terms of Black Sea exploration. The estimated resource would reach over 30bcm. The estimate comes after all the calculations, here we are talking about seismic, data interpretation, drilling and all the rest,” Romgaz CEO Adrian Volintiru has stated.3

XVIII Histria

OMV Petrom started a new offshore drilling campaign in the shallow waters of the Istria block in the Black Sea. Two new wells will be drilled by the end of the year, requiring investments of over 30 million euros. The two wells will be drilled at over 2,000 meters below the seabed, in water depths of approximately 50 meters. They target additional production from the Lebada East field (oil and associated gas), discovered in 1979.

The Istria block in the shallow waters of the Black Sea has a history of over 30 years of oil and gas production. Although fields are mature and reached their plateau production years ago, sustained investment and adequate engineering solutions enable us to unlock additional resources and to mitigate production decline.

June 29, 2020 OMV Petrom, the largest energy company in South-Eastern Europe, is pleased to confirm that it has been selected as the winner of the open international tender held by the Ministry of Economy and Sustainable Development of Georgia for the Offshore Block II.

Peter Zeilinger, member of the Executive Board, responsible for Upstream: „We continue our plans to expand our upstream activities in the Black Sea region. This is another milestone, after signing a contract to enter the Han Asparuh exploration license in offshore Bulgaria. It is a natural continuation of our more than 40 years of experience in the Romanian Black Sea waters.”

The block will be formally awarded only if the negotiation of a Production Sharing Contract is successfully finalized. If so, OMV Petrom will obtain the right to conduct oil and gas exploration activities in Block II, located on the shelf and within the economic zone of the Georgian offshore Black Sea.

Khan Asparuh Offshore Block

The companies won a permit for prospecting and exploration of oil and gas in the 1-21 Han Asparuh block in 2012. Under the terms of the contract, they committed to invest over 1.0 billion euro in the gas exploration process, while Bulgaria would receive 40 million euro ($45.2 million) in the form of bonus payments from the deal, the Bulgarian economy ministry said at the time.

In October 2016, Total said it had discovered oil in the block.

In 2019 Bulgaria’s government said on Wednesday that it accepted a request by France’s Total, Austria’s OMV and Spain’s Repsol to extend by 109 days the permit held by the three companies for exploring for oil and natural gas in the 1-21 Han Asparuh offshore block in the Black Sea. The extension is a result of a force majeure event, the government said in a statement, without giving further details about the event. Their permit is due to expire in January 2020.

June 2020 Bulgaria has granted Spain's Repsol permission to transfer 30% of the rights to explore a block off its Black Sea coastline for gas and oil to the other two rights holders.

After the transfer, a unit of French oil company Total would hold 57.14% of the rights, while a unit of Austria's OMV would have 42.86%, the Bulgarian government said in a statement Wednesday.1

The government extended a permit granted in 2012 for deepwater oil and gas exploration in the 1-21 Khan Asparuh block by two years until May 15, 2022. The permit was granted as part of Bulgaria's efforts to end its reliance on Russian natural gas supplies.

"During the two-year extension, additional geological and geophysical works and seismic surveys worth a total of 3.3 million euros will be carried out," the government said.

Contractors involved:

  • GC Rieber Shipping provided support for the seismic survey of the XV Midia block.
  • Xodus Group was awarded the front-end engineering and design (FEED) contract for the MSD project.
  • An Engineering, procurement, construction, installation & commissioning (EPCIC) contract was granted to GSP Offshore.
  • ENGIE signed a 10-year gas sales agreement with BSOG to purchase all gas produced from the Midia gas project.
  • BSOG executed a 15-year gas transmission contract with Transgaz for the transmission of gas from the MGD project to NTS.

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