The decommissioned Thames Gas pipeline in the Southern North Sea (SNS) could be back up and running by 2020 under a new project from Independent Oil and Gas (IOG).
In April, the organisation purchased the pipeline from Perenco UK Limited, Tullow Oil SK Limited and Centrica Resources Limited.
At the time, IOG explained that its strategy was to bring the pipe back into use, allowing the company to import its SNS gas portfolio to the UK.
CEO and interim chairman of IOG Mark Routh noted that the company acquired much of its SNS gas portfolio “at low cost because the assets in this area were considered stranded without a viable export route”.
But bringing the Thames Gas pipeline back into use changes that, and will enable IOG to transport half a trillion cubic feet of gas resources over the next two decades.
World Pipelines reported that work has now begun to recommission the pipeline, beginning with a 60 km stretch of the pipeline. An assessment of the pipeline’s current condition is expected to begin shortly, allowing IOG to decide what work needs to be undertaken to bring it up to standard.
One possible solution for any damaged sections of pipeline is to pass a smaller pipe through them. The existing SNS pipeline is 24 inches, which means it would be possible to run a 16-inch pipeline through it if necessary.
Mr Routh told the news provider that recommissioning the SNS pipeline should save IOG somewhere in the region of £100 million, compared to building new gas transportation infrastructure.
“We compared the price of a new pipeline – £100 million – and the time it would take to acquire and permit its installation: two or more years. In CAPEX terms, we are already £100 million ahead,” he stated.
There is a lot of work to be done to recommission the pipeline though, with World Pipelines explaining that IOG plans to drill ten new wells and install over 70km of new connector pipelines.
In addition, the company intends to construct up to five new platforms for its Blythe and Elgood and Vulcan satellite hubs. As a result of a large discovery revealed in the Harvey appraisal asset between the Blythe and Vulcan hubs, the news provider suggested that this is likely to become a third hub for the development.
As well as working on recommissioning the pipeline itself, and installing all the necessary infrastructure along its route, IOG also plans to upgrade the onshore reception facilities located at the Perenco Bacton terminal.
When IOG purchased the pipeline, it also stated its intention to acquire these facilities, explaining that the two organisations had agreed a period of exclusivity until 2018, and that a Construction and Tie In Agreement was being drawn up.
If all goes to plan, the SNS pipeline could be delivering enough gas to heat nine million UK homes for a year by 2020.
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