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Production under way at new offshore gas plant

Published 08/02/2016

Total's development is expected to add the equivalent of 90,000 barrels of oil per day in gas to the UK's energy supply
Total's development is expected to add the equivalent of 90,000 barrels of oil per day in gas to the UK's energy supply

Production has begun at a major new offshore gas plant in the west of Shetland region.

French company Total's £3.5 billion development in the Laggan-Tormore fields is expected to add the equivalent of 90,000 barrels of oil per day in gas to the UK's energy supply.

It is reported to be the largest construction project in the UK since the London Olympics.

Total said: "It's a uniquely challenging environment in which to operate, but also one with great potential."

The fields lie in a region geographically closer to the North Atlantic than the North Sea, where water depths descend rapidly from an average of 120 metres (393ft) to more than 600 metres (1,968ft).

Until today, only oil was recoverable from the area. Now, with the pipelines and infrastructure put in place, much of the energy which was previously inaccessible can now be reached.

The development has four subsea wells which will connect it to a new onshore Shetland gas plant, which has the capacity to handle 500 million standard cubic feet of gas each day.

Following treatment at the plant, the gas will then be exported to the mainland.

Arnaud Breuillac, president of exploration and production at Total, said: "Laggan-Tormore is a key component of our production growth in 2016 and beyond.

"The innovative subsea-to-shore development concept, the first of its kind in the United Kingdom, has no offshore surface infrastructure and benefits from both improved safety performance and lower costs.

"By opening up this new production hub in the deep offshore waters of the west of Shetland, Total is also boosting the United Kingdom's production capacity and Europe's energy security."

The company is operating Laggan-Tormore with a 60% interest alongside partners DONG and SSE.

The announcement comes at a difficult time for the oil and gas industry in the UK.

The North Sea has been hit hard by plummeting oil prices, with industry leaders estimating that 65,000 jobs have been lost since 2014.

Shetland MSP Tavish Scott said: "This is an important first for Total, Shetland and the wider UK economy. There is nothing but doom and gloom from some about the future of oil and gas. Yet the prospects for west of Shetland developments look positive."

"Sixty five thousand jobs have gone in recent months from the industry. Shetland is not immune as BP make changes to their staff numbers at Sullom Voe.

"But I believe that the industry has a significant role to play in the Shetland, Scottish and UK economies for years to come. Total's investment and their determination to bring this project forward is therefore a sign of much needed confidence at a particularly tough time for everyone who works in oil and gas."

Rachel Hunter, Highlands and Islands Enterprise area manager in Shetland, said: "We are delighted to see production get under way.

"This is an important development for the Shetland economy and reinforces Shetland's role in the security of the UK energy supply."

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