The Ninian partners have developed an innovative commercial framework which will apply to a number of future satellites, dispensing with the often lengthy and complicated process required to develop individual terms for each satellite. The new style agreement promotes the concept of future satellites sharing the Ninian platform topside facilities for processing, metering and export, as well as platform drilling instead of more costly subsea wells where appropriate. This enables potential satellites to be developed simply quickly and economically.
In the formative years of the UKCS oil & gas industry, fields were only developed if of sufficient size to justify the huge capital expenditure to install all the infrastructure required to get the oil and gas produced to the markets. Such infrastructure included not only the production platforms, but also pipelines to shore, as well as the onshore treatment and export facilities.
Twenty years on, many giant and medium sized fields have been developed, and a significant infrastructure in the North Sea now exists. This, combined with technological innovations, has been essential in allowing smaller accumulations to be developed as subsea satellites tied back to a host platform, which provides the processing and export facilities. The growth in satellite developments has been greatest where the satellite operator and/or unit owners have been the same as for the host facility, with the result of retaining the economic benefit within the same partnership.
In 1990, the Ninian Field Group reached agreement with the Lyell Field Group, operated by Conoco, for Ninian to act as a host facility for a Lyell subsea development. This represented one of the first in the North Sea, where the satellite field and the host facility were not owned and operated by the same parties. Subsequently agreements were reached with LASMO and Texaco as operators of the Staffa and Strathspey fields for Ninian to act as host facility for these fields which are also subsea developments. In 1994 these three fields are anticipated to produce a combined 60 mstb/d of oil and LPG and 100 mmscf/d of gas, compared with Ninian production of 60 mstb/d.
The Ninian Field Group is therefore currently party to three separate processing tariff arrangements, as well as its involvement in the Ninian Pipeline System and Sullom Voe Terminal.