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Cerulean Winds, and Ping Petroleum UK announced the signing of an agreement
to an oil and gas facility powered mainly by offshore wind.
Under the agreement signed in a meeting hosted by Secretary of State, Kwasi
Kwarteng, the production facility at Ping Petroleum’s Avalon site, located
in the UK Central North Sea, will be mainly powered by floating offshore
wind.
The provision of wind power is expected to remove up to 20,000 metric
tonnes of CO2 emissions every year from the offshore production facility
– the equivalent of taking over 4,000 cars off the road.
Ping Petroleum UK acquired a 100% stake in the Avalon site in August 2021,
with production expected to begin in 2025. The field has a total estimated
recovery of 23 million barrels of oil. The proposed development concept
for the plans have already been cleared by the North Sea Transition Authority
(NTSA), and a field development plan is to be submitted later this year.
Under these plans, Cerulean Winds with its consortium of Tier 1 industrial
partners will provide a large floating offshore wind turbine which will
be connected, via a cable, to Ping Petroleum’s Floating Production &
Storage vessel. It is expected to be one of the largest floating wind turbines
built in the UK and will provide the majority of power required by the
production & storage vessel. It is expected that green power produced
by the turbine will exceed the energy needs of the production vessel, with
the partners exploring options to supply excess energy to other nearby
production facilities. The production vessel is a 60-metre diameter facility
with a storage capacity of 270,000 barrels of oil and is capable of producing
up to 30,000 barrels of oil per day.
As part of the agreement with Ping, Cerulean Winds have committed to fully
manufacturing and assembling the offshore wind turbine in the UK. The project
is expected to realise between £80-100 million in investment in the
development and in the UK’s renewable energy supply chain. The
project was enabled by a grant to Cerulean Winds through the Floating Offshore
Wind Demonstration Programme from the UK Government’s Department of Business,
Energy and Industrial Strategy (BEIS) to support the innovation and optimisation
of the technology that will be deployed.
Tan Sri Syed Zainal Abidin Syed Mohamed Tahir, Group Managing Director
of DNeX, said: “As the world transitions to a low-carbon
future, Ping is excited to be an early implementor of this revolutionary
technology in the UK North Sea for our new greenfield project, Avalon.
This project which uses offshore wind to power operations demonstrates
our long-term commitment to establish a low carbon development concept.
It will substantially lower the emissions intensity of our operations which
supports long term climate change goals globally.”
“In addition, it enables us to seize market opportunities arising from
the energy sector’s low-carbon transformation and development. The creation
of an additional revenue stream via the supply of excess energy to nearby
facilities will positively contribute to our financial performance. “
“Furthermore, we will gain experience and exposure to the relevant markets
and stakeholders within the renewable energy sector which may lead to strategic
business developments ahead.”
Dan Jackson, Founding Director of Cerulean Winds,
said: “Our partnership marks a significant milestone for the oil
and gas industry in creating one of the UK’s first production facilities
to be powered by clean, green and affordable offshore wind energy.
“This innovative and pioneering project will be ‘Made in the UK’ and
through our delivery partners, we will be realising significant investment
in UK fabrication yards and ports. This is a critical step in scaling the
UK supply chain and building experience and a track-record to exploit future
opportunities in the fabrication, assembly and servicing of offshore wind
developments.
“This project will demonstrate how we can harness the power of affordable,
offshore wind to deliver significant reductions in the carbon emissions
of oil and gas production. The UK has a golden opportunity to make our
domestic oil and gas production the cleanest in the world – scaling the
green economy and creating thousands of jobs in the process. We are
thankful to BEIS for encouraging research and development which highlights
to potential investors that the UK Government endorses the rapid development
of integrated floating offshore wind technologies to support industrial
decarbonisation.”
Business and Energy Secretary Kwasi Kwarteng said: “The North
Sea oil and gas sector has been a major British industrial success story
for decades. We must keep supporting production on the UK Continental Shelf
for security of supply as we transition to clean, affordable, home-grown
energy. In the meantime, we need to cut emissions from production.
Platform electrification projects such as this are a welcome step forward
to reduce emissions from oil and gas production, secure jobs and new skills
and deliver on the commitments of the landmark North Sea Transition Deal.”
Cerulean Winds has previously announced a floating offshore wind and green
energy proposal for Crown Estate Scotland’s Innovation & Targeted
Oil and Gas seabed leasing round. The initiative provides seabed leases
to green energy developers to support the electrification and decarbonisation
of oil and gas facilities in the UK Continental Shelf. Cerulean Winds’
plans to bid for multiple sites at 1.5 GW scale of floating offshore wind
which it claims would unlock £6 billion proposed investment per site.
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