MAY 2008

Shell crew begins drilling for oil off Donegal coast
Taken from Derry Journal Friday 23rd May 2008

One of the largest drilling rigs in the world began three months of exploratory drilling under contract for Shell E&P Ireland Ltd., off the north-west Donegal Coast on Tuesday, 20th May, and on 19th May a rig for StatoilHydro began exploratory drilling off the county's south-western coast.

The Leiv Eiriksson, under contract to Shell, will be drilling more than 1,700 metres down, in some of the deepest waters ever drilled off the Irish coast. Typically, in the North Sea, drilling is conducted in depths of 50 to 100 metres. By comparison, Shell's find in the Corrib field off the Mayo coast came at a depth of about 350 metres.

"Advances in technology are allowing us to explore in ever-deeper waters," said Colin Joyce, communications advisor for Shell E&P Ireland. The Leiv Eiriksson will be the only rig Shell has off the Donegal coast this year, he said. The Statoil rig, the Ocean Vanguard, is drilling in depths of 176 metres, said John Conroy, licence and operations manager for StatoilHydro in Ireland.

Shell is drilling in an area called the West Dooish Prospect, about 150 kilometres off the north-west coast of Donegal. The StatoilHydro site is about 130 kilometres due west of Killybegs.

The frontier exploration licenses that shell and Statoil hold mean that they are undertaking exploratory drilling to determine whether hydrocarbons are present in the wells. If hydrocarbons are discovered, Mr. Conroy said, they may drill further wells to determine whether the prospects are commercially viable. Mr. Joyce said he could not estimate the probability of a find for Shell. "The chances of success in Ireland being one in 40, you couldn't put a figure on it," he said.

There is a crew of about 120 on the Leiv Eiriksson, including specialists who may only be on the rig for a brief time, and a crew of up to 100 on the Ocean Vanguard.

Supplies are sent to both rigs from the port of Killybegs and people are transported to the rigs by helicopter from Carrickfin Airport. The journey from Carrickfinn to the Leiv Eiriksson takes less than an hour, Mr. Joyce said, and Mr. Conroy said the flight to the StatoilHydro rig takes about 35 minutes.

The Leiv Eiriksson is one of the world's largest semi-submersible rigs. It was chosen for the West Dooish drilling because of its ability to deal with the extreme depths and weather conditions of the North Atlantic. The rig uses a dynamic positioning system to hold its position rather than traditional anchors.

Jeroen van der Veer, the chief executive office of Royal Dutch Shell Pic, Europe's largest oil company, has indicated that deep drilling may become more common. "We can't expect profits in easy oil," he said at an oil conference in Paris last year, according to Bloomberg News.

The Irish Offshore Operators Association for the Irish offshore oil and gas industry, estimates this will be the busiest year for exploration in Irish waters since 1978, with total investment set to reach 300 million dollars.