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Oil and gas electrification ‘a significant prize’ but faces economic and regulatory challenges

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The Net Zero Technology Centre, the Cygnus joint venture comprising Neptune Energy, Spirit Energy and Sealand Projects have announced the findings of a study into electrification of offshore platforms

 

The study, the ‘Southern North Sea – Oil & Gas Asset Electrification Study,’ explored the potential to electrify an offshore platform with power from offshore wind, using the Neptune-operated Cygnus platform in the UK Southern North Sea as a case study.

According to the authors of the report, “there were no immediate blockers identified,” however it was noted that the timeline for consenting, design and commercial commitments are constraints for securing electrification.

The report authors also stated that, although extremely promising, there remain significant challenges to be addressed in terms of the commercial viability of electrification based on high capex costs and direct impact on the levelized cost of energy. “However,” they said, “this requires to be contextualised due to the sensitivity of any future carbon /cost of /achievement of zero emissions.”

The report states that there is the potential for Cygnus to be taken forward for electrification – under the correct economic conditions – with further collaboration between the oil and gas and offshore wind sectors. Electrification of the Cygnus platform could, the authors of the report state, “spearhead a route to decarbonisation, not only for the Southern North Sea but the oil and gas industry as a whole.”

The Southern North Sea is home to numerous planned and existing offshore windfarms increasing the potential sources of power for platform electrification.

By 2030 there will be 6.8 GW of wind power within 50 km of Cygnus, increasing to 14.1 GW within 100 km of the asset, making it a suitable case study for the investigation of electrification using offshore wind.

The study examined four options that offer a potential pathway to electrification, including: local offtake with a power purchase agreement; local offtake with an offshore transmission owner; reallocation of turbines; and dedicated offshore windfarms serving a platform.

Net Zero Centre senior product manager Graeme Rogerson said, “The size of the prize is significant if we can establish a viable way to leverage the existing infrastructure to supply power to offshore oil and gas assets.

“We have a number of barriers to overcome including regulatory challenges and establishing a way to make one of the four proposed options economically viable.

“However, the engagement levels from stakeholders have been hugely promising and there is definite appetite to maximise the opportunity for electrification of oil and gas assets.”

Neptune Energy director of global operations and electrification Mungo McLeish said, “Collaboration across oil and gas and renewables sectors can improve our understanding of the opportunities and challenges associated with the electrification of assets in the Southern North Sea.”

Sealand Project Limited senior project engineer Kenneth Cunningham said, “Electrification of platforms has a key part to play. Tying into a windfarm is an innovative opportunity which raises challenges, however the level of engagement across regulatory bodies and industry was hugely encouraging, and we remain thankful for the support and advice. It is through this collaboration that electrification opportunities, and ultimately the route to net-zero, can be delivered.”

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