A Reader Responds To The "Cambo" Situation -- December 15, 2021

This was posted earlier today:

Oil: wow, there's been a lot of twitter noise about Shell pulling out of the Cambo oil field. I wasn't going to talk about it; I think it's a non-story but then Platts posted this: the demise of the UK's Cambo oil project could prove a pivotal moment for the country's offshore industry blah, blah, blah .... am I missing something here? What is the Cambo project? From an operator in the Cambo:  

The Cambo Field would help to reduce the volume of imports required to meet energy demand in the UK, by delivering up to 170 million barrels of oil equivalent during its 25-year operational life. Cambo would also provide a further 53.5 billion cubic feet of gas – enough to power 1.5 million homes for a year.

Comment: If I'm reading that correctly, "... up to 170 million boe during its 25-year operational life ...." isn't that like, seven million bbls a year. The Bakken produces in excess of seven million bbls a week. 

In response to that posting, a reader replied to a question on Quoro with this reply:

Interesting, Shell was only a 30% partner.

I’m surprised by the lack of interest in oil and gas development anywhere in Europe (except Russia).

The mindless opposition to fracking, dependence on Russia and the idiotic pursuit of energy from intermittent, unreliable wind and even more incredible installation of solar in such a northern location is “surprising.” What’s the UK average solar capacity factor? 10? It’s 30 here in sunny Cali, and solar here is dumb enough.

The Cambo oil field may not have been economical until recently (tough isolated environment and not huge). But in the new era, starting right now it is economical with permanent high energy prices. Remember: the cost of production doesn’t determine price, it’s competition. Oil and gas no longer has to compete with affordable coal, and the “cheaper than fossil fuels wind and solar” are anything but "cheaper" when “backup” cost is honestly included.

How bad is the Scottish political situation for investing in energy resources that actually work?

nsenergy

The Cambo oil field was discovered by Hess Corporation in 2002 and appraised by four appraisal wells as of 2012.

Austrian oil and gas group OMV became the operator of Cambo by acquiring four licenses in West of Shetland, UK from Hess in March 2014.

Siccar Point Energy completed the acquisition of OMV’s North Sea assets in the UK in January 2017 and drilled the fifth and the final appraisal well 204/10a-5 on the Cambo field in 2018.

Location and reservoir details

The Cambo field is located in approximately 1,100m-deep North Se waters, approximately 125km northwest of the Shetland Islands, Scotland, UK.