The Central Area Transmission System (Cats) And Central Graben Development

Abstract

ABSTRACT The central Area Transmission System (CATS) provides a common gas gathering and transportation facility that has the potential to open up the development of gas reserves in the Central Graben Area of the North Sea. Completed in 36 months, the $2.1 billion project will be capable of carrying 1.6bcf per day direct to the UK5 industrial heartland and includes the development of the North Everest and Lomond gas fields. This paper outlines the technical and complicated commercial background to the project and the facilities it comprises. INTRODUCTION & BACKGROUND The Central Area Transmission system (CATS) is part of the Central Graben Development project being developed by two separate groups of companies led by Amoco (U.K.) Exploration Company and on behalf of its Co-Venturers. The project involves the development of two offshore gas fields, Everest and Lomond, approximately 120 miles east of Aberdeen and the construction of a 254 mile, 36 inch diameter pipeline to Teesside in the north east of England, where the gas will be metered by a new offshore terminal. The first 300 million cubic feet of gas per day produced through the system will fuel a new combined cycle electricity plant recently. Completed at Teesside, though the pipeline itself will have the capacity to transport approximately 1.6 bcf per day thus opening up the possibility of further gas field development in the central area of the north sea and third party use. The genesis of the CATS project lies in the discovery of the Lomond field in 1973, followed by the Everest discovery some 10 years later. Together these two fields contain an estimated 1.5tcf of gas and 50 MM blls of condensate, lying approximately 14 miles apart, and were judged capable of sustaining a plateau delivery rate of around 300 MMSCFD of gas per day for about 10 years before going into decline. As single fields they were too small to be commercially attractive being some 120 miles offshore but sold together were viable. MARKETING NEGOTIATIONS In 1985 marketing activity was initiated. First a study was prepared in which evacuation routes were investigated. The study looked at land falls along the eastern coast line of Great Britain, the market potentials for the liquids stream and the potential for gas markets outside of the traditional customer, British Gas. Government attitudes and policies were changing at this time and gas sales to other industries were becoming possible. Two obvious directions emerged from the study that identified Teesside (North East England) and St. Fergus (Scotland) as the best land falls for the pipelines. With its heavy industry base and good harbour facilities, Teesside held more future potential for gas and liquid sales. British Gas was clearly a potential buyer for the gas but it was ICI/ENRON who emerged as the eventual buyer.