Germany

Country Summary

Non-operated working interest in 2 groups of shallow-water licenses: Geldsackplate and H&L Blocks.

Asset Area (KM2) Working Interest Seismic Coverage Technical Maturity Operator
Geldsackplate 366 45.00% 2D/3D Exploration, Appraisal & Development Oranje-Nassau Energie
H&L Blocks 2572 20.00% 2D Exploration Wintershall

Geldsackplate is a well-defined low risk prospectivity in the multi-tcf basal Rottliegend play.

Location and Geology

The Geldsackplate licence forms part of the greater GEms area (Gateway to the Ems) together with the adjacent N04, N05, N07c and N08 licences offshore the Netherlands.  GEms is an extension of the basal Rotliegend play recognised in both the 4Quads and H&L acreage immediately to the north.

The GEms area is situated approximately 20 km north west of the island of Borkum offshore Germany and its western boundary follows the German-Dutch median line, confirmed by the supplementary Ems-Dollart Treaty executed in October 2014. The water depth ranges from 10m to 25m. Directly adjacent to the west are the Dutch GEms N05 and N08 licence areas where Discover is a joint venture participant with Oranje-Nassau Energie (ONE) and Energie Beheer Nederland (EBN). The Geldsackplate licence is bounded to the north and north-west by the H&L and 4Quads licence areas.

The prospectivity identified in the GEms area is the Lower Rotliegend Findorf play of the Elbe sub-group. The reservoir interval in this area is younger than the 4Quads and H&L Havel Sandstones but bears many similarities. The reservoir consists predominantly of fluvial and aeolian facies deposited in topographic lows related to the Base Permian Unconformity, sourced from the Lauwerszee Trough to the south.

Several wells within the region have encountered the Findorf Sandstone interval up to 35m in thickness. Two wells within the Netherlands GEms licence area encountered the Findorf reservoir but were located sub-optimally for reservoir development at the distal end of the facies and consequently, historically the key risk in the GEms area was reservoir development. However, propriety seismic inversion of the released 3D volumes has enabled the reservoir interval at the wells to be calibrated to the seismic volumes and the sands mapped directly. As a result, several structurally simple low risk prospects have been identified across the GEms acreage. The Ruby gas discovery in September 2017, was the first well in the area to be drilled on 3D seismic and proved reservoir can be discriminated on seismic and de-risks the play fairway.

Equity Interests

Discover holds a 45%, non-operated, interest in the Geldsackplate licence through its wholly owned subsidiary, Hansa Hydrocarbons Limited. The remaining 55% interest is held by ONE.

Operator

The licence is operated by ONE. Following the acquisition of 5% of Discovery’s interest in the licence in March 2018, ONE holds a 55% interest in the licence. In conjunction with the 5% interest acquisition, operatorship of the licence was transferred from Discover to ONE.

Licence Status

The Geldsackplate licence was awarded in June 2015. The licence has an initial three-year term with a drill or drop decision at the end of the term. The drill extension option was exercised with the licence extended for a further two years to 30 June 2020.

The Ruby discovery extends across the N04, N05, N08 and Geldsackplate licences in the Dutch and German North Sea sectors respectively in a water depth of 28m. The N05-1 well was drilled as a joint well between the N05 and Geldsackplate licence groups.  The well was operated by ONE and drilled with the Paragon Offshore Prospector-1 rig, which moved off location on 30 August 2017.

In the event of development, gas would most likely be evacuated via the existing subsea T-piece in the NGT pipeline, approximately 20 km to the south west. This would avoid the need for any beach crossing on the Waddenzee islands. The proximity of the potential developments in the 4Quads area to the north and the H&L area to the east of the GEms area presents the opportunity upon success for strategic synergies for optimising development and infrastructure schemes for the play and region.

Several further drilling locations have been matured for exploration drilling following the Ruby discovery successfully opening this basal Rotliegend play. Permitting and planning for drilling the Diamant and Ruby South East prospects are on the way with further exploration drilling planned in Q4 2019/Q1 2020.

H&L Blocks - discovered resources combined with low risk material prospectivity make this an important strategic resource.

Location and Geology

The H&L Blocks are located in the southwestern sector of the German North Sea immediately east of the Dutch/German median line and bordering the inshore area (Küstenmeerzone), north Germany to the south. The licence covers 2,572 sq. km, with water depths ranging from 10m to 40m. The licence covers Blocks H15, H16, H17, H18, L1, L2, L3, L4 and L5.

The geological setting for the hydrocarbon potential in the H&L Blocks is the prolific gas bearing Rottliegend  sandstone reservoir. The closest producing reservoirs from the Rottliegend sandstones are found in the giant Groningen field located only 55km to the south onshore Netherlands.

The licence contains several discoveries but due to a poor understanding of sand distribution and significant nitrogen presence, the area remains relatively under explored. The L1-Alpha discovery was made in 1975 and proved gas in the Lower Rottliegend Havel sandstones with a well flow test of 6 mmscfd. No gas water contact was established with the well and given the nitrogen content of 19% and the poor understanding of sand distribution the discovery was left undeveloped.

In January 2010, L1-2 well was drilled. This was the first well drilled in the area for over 30 years. The results of the L1-2 well confirmed L1-Alpha as a potentially commercial development and the data has been incorporated into a revised understanding of the area. The joint venture partners have now committed to perform a large 3D seismic survey over the discoveries and neighbouring prospectivity, subject to permitting by the authorities.

Equity Interests

Discover through its wholly owned subsidiary, Hansa Hydrocarbons Limited, holds a 20% non-operated interest in the licence.

The remaining licence interests are held by Wintershall (40% operated interest) and ENGIE (40% non-operated interest).

Operator

Licence B20008/71 is operated by Wintershall, a wholly owned subsidiary of the chemical group BASF.

Licence Status

The B20008/71 licence was originally awarded to Wintershall (100% interest) on 1 June 2006. The most recent licence extension was on 22 May 2018, when the German authorities agreed to extend the licence term to 31 May 2020.

The L1-Alpha discovery is located in a water depth of 33m and only 35km from a sub-sea tie-in point to the 36” NGT trunkline, offshore Netherlands. The gas quality from the L1-1 well test meets the requirements for export through the NGT pipeline and associated processing terminal at Uithuizen. Uithuizen delivers gas into both the Dutch and German local gas markets. The joint venture is working towards a case to drill the Saphir Sud prospect in 2019/2020. The Saphir prospects have been significantly de-risked by the Ruby discovery.