Austria’s OMV is serious in its bid to become a major player West of Shetland (WoS) by revealing plans for a new deepwater development hub based around its recently acquired Cambo oil field asset.

Confirming its decision to buy the WoS portfolio held by Hess, which includes the undeveloped Cambo discovery, OMV has gone on to outline its intention to use the find as the basis for a new harsh environment field centre to which other nearby discoveries will be tied back.

DI has also confirmed that this will be separate from the stalled Rosebank FPSO (Floating Production, Storage and Offloading) vessel project operated by Chevron (itself a partner in Cambo) located to the north-east, in which OMV also took a significant stake towards the end of last year.

“We are considering a range of development concepts. As there are currently a number of potential tieback opportunities to Cambo, and given other prospects that are likely to be drilled in the coming years, we expect that Cambo will be developed as a separate hub,” an OMV spokesman told DI. Denmark’s DONG Energy is also a 20% stake holder in Cambo.

Work on Rosebank – previously tipped as where Cambo was to have been tied back to if developed – will continue as a separate project: “The Rosebank partners are aligned in the need to optimise the development of Rosebank and are working effectively together to do this. This has not been impacted by OMV’s additional equity acquisition in 2013,” the OMV source clarified.

Cambo was discovered back in 2002 in a water depth of approximately 1,100 m (3,608 ft), so floating development solutions are likely to be the way forward, although studies have not yet been undertaken on whether to go for an FPSO, Spar, Semisub, TLP or other facility. Conceptual studies are expected to get underway this year for the field in UK block 204/5a.

Four wells have been drilled at Cambo since the initial discovery probe, including Cambo-4 in 2011 and Cambo-5 just last year, drilled by the Stena Carron drillship with Chevron as operator.

With its latest asset deal OMV is acquiring a total of four licences from Hess: P1028 and P1189, containing Cambo, where OMV increases its equity from 15% to 47.5%, along with P1830 where OMV’s stake will rise from 25% to 75%, and which contains a prospect called Blackrock. Blackrock is scheduled for drilling next year. OMV also acquires 75% equity in P1831.

OMV is paying Hess US $50 million initially for the portfolio, and a further contingent payment of $35 million dependent on future development.

The Austrian explorer indicates the Hess transaction involves 60 MMboe of recoverable reserves, mainly in Cambo, and has indicated plans for further appraisal of the area’s potential, including Blackrock.

Outlining the rationale behind the Hess deal, the company said: “OMV UK has a unique position in the Cambo area offering potential valuable synergies, with the adjacent OMV-operated Tornado gas/condensate discovery and the Suilven discovery. There are also further prospects with tieback potential to develop Cambo as a valuable area hub.”

At present there is little infrastructure in place, with other projects underway in the region including Total’s Laggan/Tormore project, currently being developed as a subsea tieback to shore.

Last August OMV undertook a bigger investment in the North Sea region worth $2.65 billion, which saw it acquire Statoil’s equity in two Norwegian fields – 19% in Gullfaks and 24% in Gudrun, plus Statoil’s 30% in the Rosebank project. It also took 5.877% in the BP-operated Schiehallion field in the UK sector.

Gerhard Roiss, OMV’s chief executive said at the time: “It confirms OMV’s clear focus towards increasing the significance of its E&P activities. We are acquiring significant positions in developments lying at the heart of our North Sea growth region, the development capital will be largely funded by the operating cash flows of the already producing assets which are part of the portfolio whilst the purchase price represents a reinvestment of the proceeds we have generated from disposals and working capital reductions from our downstream divisions over the last 18 months.”

Offshore