Oil and gas contractors and companies will be happy to learn that the UK North Sea still has a lot of oil reserves. Hurricane Energy has discovered oil just west of the Shetland Islands.
The discovery could be the largest that the UK North Sea has witnessed this century. This find is also good news for BP and Shell, who have been awarded exploration licences for areas around the Shetland Islands, and the Government hopes that these new exploration licences will give impetus to the flailing UK oil and gas industry.
Shell and BP were awarded licences to look for oil near the Shetlands after several large oil and gas companies have shown interest in this region while decommissioning mature wells in other parts of the North Sea.
The well, which is called Halifax, is said to have a column of oil that goes down at least a kilometre. Initial reports suggest that this column of oil could be the single largest oil reserve, and it may be connected to the nearby Lancaster oilfield, which is also owned by Hurricane Energy. The company has been successful in drilling five oil wells in the region.
In January, before the drilling started, Cenkos Securities Analyst Ashley Kelty stated that the Halifax oil well could be the most important well in the UK North Sea. He said that if the reserves in the well were connected to the adjoining Lancaster well, the area would contain more than a billion barrels of oil.
Hurricane Energy is holding talks with potential investors for its Lancaster well, and this discovery could help those talks quite a bit. However, there is still scepticism among oil and gas industry experts and analysts, who claim that the company did not conduct a drill stem test at its Halifax well. This test is needed to accurately show the productive capacity of an oil well.