Exploration Country Focus
The Netherlands
Jaap Breunese & Douwe van Leverink
TNO Built Environment & Geosciences, Advisory Group for the MEA
Introduction
With 44 discovered oil fields and 406 discovered gas fields The Netherlands is typically a gas country. Due to the excellent exploration conditions many plays can be considered as mature. With major gas reserves and its central position The Netherlands has been one of the major gas exporting countries in the world for many years. Lately, other countries have passed by the Dutch who are however still positioned in the top ten (#9 according to BP review 2008).
Exploration and Production History
Exploration and production during the early 20th century was primarily focused on coals in the Southern part of the Dutch onshore. Commercial exploration and production of onshore oil and gas fields started only halfway the previous century and it took until the 1960s that exploration started in the offshore.
Figure 1. Gas and oil accumulations and pipelines in the Netherlands. The reserves in the Groningen gasfield (indicated with the white arrow) are still over 1000 bcm (Oil and Gas in The Netherlands, 2008).First oil was found in 1923 near Corle in the province of Overijssel. In 1938 a new indication for oil was discovered when a demonstration well drilled in the centre of the city of The Hague discovered oil stains at 460m depth. Five years later, in 1943, the Schoonebeek oil field was discovered, which still is the largest onshore oil field in Western Europe. The first big oil hit was also the last, as other oil fields that were found could not be compared to Schoonebeek in size. Production from the Schoonebeek field was ceased in 1996 after producing 25% of the viscous oil. The only Dutch oil field that comes close to the Schoonebeek field in size is the ‘De Ruyter’ oil field, which was discovered a few years ago in the southern offshore west of The Hague as a result of a high risk exploration strategy. Its production covers nowadays half of the total Dutch oil production (1.49 million Sm3 out of 2.5 million Sm3 per year or 9.37 million barrels out of 15.64 million barrels per year).
The first commercial gas discovery was made in 1948 Coevorden. Eleven years later, in 1959, the giant Groningen gas field was discovered in the Permian Rotliegend sandstones under the province of Groningen (Fig. 1). This initiated large scale gas exploration in The Netherlands. Next year its 50th anniversary will be celebrated and expectations are that more gas will be recovered from the field for the next 50 years. Due to the underestimation of the size of the field the estimated reserves grew throughout several years to a final GIIP of almost 102.5 trillion cubic feet (±17.1 billion b.o.e.). This was the largest known gas field in the world at the time of discovery and is still among the largest. Due to the excellent reservoir characteristics the Groningen gasfield can be used as a swing producer, by increasing the production during the winter and cutting down production during the summer. This is very rare for gas fields of this size. With more than 1000 bcm of remaining reserves the field is of major importance to the Dutch gas supply.
Policy
The 1973 oil crisis made the Dutch government more aware of the importance of the large reserves of the Groningen gas field which could ensure the country’s energy demand for a very long time. Therefore the Dutch government developed a policy which is known as the “policy of small fields”. According to this policy exploration for and production from small/medium sized fields has been encouraged and the Groningen gas field is used as a swing producer. This will ensure that The Netherlands have a security of gas supply, that small fields will be developed and that international fluctuations in energy supply have less impact. In this way the Groningen gas field should exist until the last small gas fields in the Netherlands are exhausted.
Figure 2. All gas and oil fields distribution in or close to the Southern Permian Basin. Rotliegend facies distribution is displayed to indicate the basin geometry (from Doornenbal et al., 2009). The colours represent deposition of sediments in fluvial plains (dark blue), dunes (yellow), playa margins and sabkhas (light blue) and lakes (light orange). Be aware that these fields presented are not only situated in Permian reservoirs. (download PDF version of map)This policy has lead to the drilling of more than 1100 exploration wells and has proven to be successful in finding new reserves. Of the 406 proven gas fields (both on- and offshore) 215 are in production, 4 are being used for gas storage, whereas the production from another 60 fields has already ceased (Fig. 1). The exploration activities have led to an extensive coverage of the Dutch sub surface with 2-D and 3-D seismic (3-D coverage is ca. 56% of the Dutch on- and offshore). Together with the thousands of exploration and production wells the Dutch subsurface may be one of the best explored.
The Dutch Mining Act implies that copies or samples of all data which are acquired from the subsurface (seismic, drilling results and cores) need to be handed over to the State. Since 2003 the release period to the public domain was reduced to 5 years for most of the data. Since two years a new website portal provides easy access to much of this information. In this way the Dutch E&P market can be more easily approached by new companies.
Geology and Reservoirs
Hydrocarbon plays in the Netherlands range from Carboniferous to Quaternary age. The Permian Rotliegend play is by far the most important comprising 65% of the Dutch reserves (even if excluding the Groningen gasfield) followed by the Triassic play. The Rotliegend play situated in the Southern Permian Basin (Fig. 2) consists of aeolian and fluvial sandstones which are in an almost ideal position above sourcing Westphalian coal measures (Carboniferous) and below sealing Zechstein salts. The Triassic play consists of single or stacked reservoirs of successive sandstone and claystone formations which have also been sourced by the Westphalian coal measures.
In contrast to e.g. their German neighbours the Dutch are blessed with high quality reservoirs. As a consequence there is a tendency to only develop prospects that are not considered or presumed to be ‘tight’. Recovery factors normally range from 70 to 90% or even exceeding 95% (e.g. the Groningen field). To give an impression of the relative easiness to produce from fields in the Netherlands, fracjobs have been performed in only 35 production wells.
Future
Because of its relative small size, its density of population and the fact that The Netherlands is a low-lying country there is continuous concern about possible effects of gas production such as land subsidence and induced microseismicity. However, policy and ongoing technical development ensure that gas exploration and production can be continued for many decades.
Figure 3. Overview of the gas reserves and cumulative production from 1965 to 2008 (Oil and gas in The Netherlands, 2008).The creaming curve shows no creaming off yet, but as the ‘easy fields’ seem to reach their end of production and remaining reserves are declining a new impulse is needed to develop prospects that have been left aside and to increase exploration activities (Fig. 3, 4). High oil prices have made NAM decide to restart the production of the heavy oil in the Schoonebeek field in 2010. On the other side traditionally big players in The Netherlands like NAM already give signs to diminish their interest in the Dutch gas production. Their place can be taken over by players who are more experienced and willing to produce from difficult reservoirs. Especially producing from tight reservoirs will be one of the main challenges. A point of concern is the timing of this change.
Large fields are not found anymore, which is also a result of the present low risk drilling strategy of the companies. In the future the development of the smaller fields will only be economically viable when the present day infrastructure is maintained. This will require conditions such as high energy prices, a favorable mining policy and synergy between different possible users of the infrastructure.
Figure 4. Creaming curve for the gasfields in the Rotliegend reservoirs, representing the bulk of the Dutch gasfields. (www.nlog.nl)Among the interesting new play concepts are the indications for Early Carboniferous reefs and recovery of shallow gas. Recently Chevron has successfully started the development of a shallow Plio-Pleistocene gas field in the Northern Dutch offshore. This success shows that also this shallow gas can be produced.
Furthermore, there is increased awareness of the fact that the assets can be of economic importance even after the production of hydrocarbons has ended. E.g. the potential for the use of depleted gas fields for the storage of natural gas or CO2 draws attention from policy makers and industry alike.
Overall the proven reserves are still substantial and new exploration and production activities will play an important role in The Netherlands for at least the next twenty years.
References
BP Statistical Review of World Energy 2008, www.bp.com
Doornenbal, J.C. et al, 2009. Petroleum Geological Atlas of the Southern Permian Basin Area. EAGE Publications b.v.
Oil and Gas in The Netherlands Annual review Exploration and Production 2007
A review of oil and gas exploration and production activities during 2007and a prognosis of the production for the period 2008-2033. www.nlog.nl
Wong, T., Batjes, D.A.J., de Jager, J., 2007. Geology of the Netherlands