Project Profile
Value: Undisclosed
Location: Approximately 93 miles offshore Hong Kong, Pearl River Mouth Basin of the South China Sea, China
Production: 49,000 barrels of oil per day
Water Depth: 320 feet
Start-up Year: 2003
In 2003, Devon Energy Corporation commenced production from its Panyu oil field. Gross field production reached 60,000 barrels of oil per day in the third quarter of 2004. Production volumes increased steadily over the next year as the remaining wells were drilled and completed. Devon drilled the initial discovery well at Panyu in 1998 and a follow-up discovery in 1999. Panyu is located approximately 93 miles offshore Hong Kong in about 320 feet of water in the Pearl River Mouth Basin of the South China Sea. Development required construction and installation of two fixed platforms from which the development wells are being drilled. Oil is produced to a floating production, storage and offloading vessel (FPSO). Sales begun in the fourth quarter of 2003, when the first shipment of oil will be offloaded from the FPSO and transported to market. Devon Energy China, Ltd. was initially the Panyu field operator with a 24.5% working interest. Other partners are CNOOC Ltd., with a 51% interest, and Burlington Resources Inc., with a 24.5% interest. In 2010, CNOOC acquired the 24.5% stake in Panyu field in South China Sea oil block from Devon Energy Corporation, for US$515 million. With the acquisition, CNOOC, the operator of the Panyu field, increased its stake from 51% to 75.5%, while the other partner, ConocoPhillips will continue to hold the remaining 24.5%, after buying Burlington’s share. Currently gross production from the block is 49,000 barrels of oil per day.
CNOOC Ltd. was to opt for either a platform-based development or sub sea completions for its Panyu 34-1 gas field in the Eastern South China Sea on 11th August 2005. CNOOC dabbled with the idea of all-sub sea development when Shell and Unocal were joint ventures in the Xihu Trough (Chunxiao) gas project. However, the two Western giants took their subsea expertise with them when they withdrew from the Xihu venture. Chinese operator was evaluating the feasibility of an all-sub sea development for PY 34-1 before submitting an oilfield development plan to the authorities and heading to the market with tenders for construction and installation August 2005. A 365-kilometre gas pipeline system will connect the Panyu fields and the Huizhou (HZ) 21-1 gas field with fast-growing markets in Guangdong province along the southeast coast. Kvaerner E&C Singapore, part of the Aker Kvaerner group, is carrying out basic and detailed design engineering for the pipeline project, as well as the onshore receiving facilities as of August 2005.
The preliminary development plan of PY30-1 and PY 34-1 calls for an integrated design to add productions from smaller reserves in the area to capture further economics. The gas is targeting the fast growing Guangdong gas market. As of March 2010, CNOOC has decided to tie a shallow-water development in with Husky’s huge Liwan deep-water gas find in the South China Sea. The company is now involved in the overall development of the Panyu 34-1 gas field, which is close to Liwan’s platform in shallower waters. The plan is to build a new well-head platform for Panyu 34-1. CNOOC’s engineering unit, China Offshore Oil Engineering Corporation (COOEC) will spearhead engineering, procurement and construction of the Panyu 34-1 platform, along with Husky’s Liwan platform. According to an agreement, CNOOC is the operator of the shallow-water facilities’ engineering, procurement and construction, while Husky will take care of the deep-water part of it. In a separate development, COOEC is set to build two extra platforms for the Panyu 42-51 oilfield in the South China Sea. Cameron has won the contract for six subsea production trees, production controls, one manifold, associated subsea equipment, rental tooling and service support.
Operators:
CNOOC: Operator with 75.5% interest
ConocoPhillips: 24.5% interest
Contractors:
China Offshore Oil Engineering Corporation (COOEC): EPC contract of the Panyu 34-1 platform
Cameron: Six subsea production trees, production controls, one manifold, associated subsea equipment, rental tooling and service support
A consortium for EPC services:
Technip
Offshore Oil Engineering Co. Ltd (COOEC)
Emerson Process Management: Provide process automation, safety, and asset management technology
Kvaerner E&C: Basic and detailed design engineering for the pipeline project
InterMoor: On- and offshore project management; installation engineering, procedures and procurement, and key offshore personnel for the project.