ConocoPhillips is planning to sell off its 24% interest in the Clair field to the west of the Shetland Islands – the largest oil field in British waters – and has already hired banks to advise it on the process.
Analysts suggested the US oil company could raise anywhere between US$2bn and US$3bn from the sale.
Discovered way back in 1977, Clair remained undisturbed for the next 28 years despite its huge reserves – it has an estimated 8 billion barrels of oil in place – because of the technical challenges of producing oil from its highly fractured reservoirs.
A small first-phase project finally began production from a single platform in 2005, but the much larger £4.5bn Clair Ridge development – which is forecast to produce 640 million barrels over a 40-year period with a peak output of 120,000 barrels a day – got underway in 2011 and should start producing oil in late 2016.
While ConocoPhillips’ move is entirely consistent with the company’s strategy over the past three years of disposing of overseas assets to focus on US shale operations, its timing inevitably raised questions about the impact on the sector of a vote in favour of Scottish independence.
The Yes Campaign has highlighted Clair as a prime example of the vast oil reserves that could underpin an independent Scotand’s economy for the next four decades, although politicians in Westminster and North Sea experts – including Sir Ian Wood – maintain its estimate of 30 billion outstanding recoverable barrels is probably around double the true figure.
The other partners in Clair are BP, the field operator with a 28.6% stake, Shell (28%), and Chevron (19%).