Upstream Portfolio Assessment

Objective

HELLENiQ ENERGY engaged io consulting to conduct an upstream portfolio assessment for its offshore deepwater acreage in Greece. The objective was to evaluate technical feasibility, economic viability and optimal development strategies for multiple oil and gas prospects. The study focused on identifying cost-efficient infrastructure solutions, gas monetisation pathways, and risk mitigation measures to support investment decision-making and potential farm-out opportunities.

Project Scope

The assessment covered several offshore blocks, considering multiple oil and gas development scenarios:

1. Oil Cases – Evaluated Floating Production Storage and Offloading (FPSO)-based production systems with potential for gas export, reinjection or gas-to-power (GTP).
2. Gas Cases – Analysed both FPSO-based processing and long-distance subsea tie-backs (SSTB) to onshore facilities.
3. Gas Monetisation Alternatives – Investigated pipeline export, reinjection and power generation strategies.
4. Economic & Sensitivity Analysis – Assessed the impact of well productivity, gas pricing and CAPEX variability on project economics.

Findings & Recommendations

Findings

• Development Feasibility & Concept Selection: FPSOs were the most technically and commercially viable solution for oil developments, while SSTBs offered cost advantages for gas fields.
• Gas Monetisation Constraints & Strategy: Gas monetisation remains a key challenge due to the absence of offshore gas infrastructure in Greece. Potential export routes depend on planned regional pipelines, which have uncertain timelines.
• Economic Viability & Resource Prioritisation: Larger oil prospects demonstrated strong economic potential, while smaller fields would require clustering with adjacent discoveries to be viable. Gas developments depended on sufficient well productivity and competitive gas pricing.
• Well Productivity Sensitivity: Economic viability was highly sensitive to well productivity. Gas fields, in particular, required at least base-case productivity to justify investment.
• FPSO Leasing vs. Ownership: Leasing reduced upfront CAPEX and improved internal rate of return (IRR) but resulted in lower net present value (NPV) due to higher long-term operational costs.
• Long-Distance Multiphase Tie-Back Feasibility: Long-distance SSTB developments were cost-competitive with FPSO-based gas processing but required further technical validation of flow assurance and subsea pipeline installation risks.
• Gas-to-Power as a Commercialisation Option: Power generation using offshore gas was technically feasible and could provide an alternative monetisation route for gas fields near Greek power infrastructure.

Recommendations

1. Development Feasibility & Concept Selection: Prioritise FPSO-hosted oil developments while progressing gas export solutions to maximise portfolio value.
2. Gas Monetisation Constraints & Strategy: Develop flexible gas monetisation pathways, including potential onshore processing hubs, power generation integration and phased infrastructure investments.
3. Economic Viability & Resource Prioritisation: Prioritise high-impact exploration targets and consider integrated field developments to optimise infrastructure usage and improve project returns.
4. Well Productivity Sensitivity: Prioritise reservoir characterisation and appraisal drilling to reduce uncertainty and confirm production potential.
5. FPSO Leasing vs. Ownership: Leasing is preferred for smaller FPSOs (e.g., 60kbopd oil FPSO, 300MMscfd gas FPSO), while ownership may be more beneficial for larger-scale developments.
6. Long-Distance Multiphase Tie-Back Feasibility: Conduct flow assurance studies and deepwater pipeline feasibility assessments to confirm technical viability.
7. Gas-to-Power as a Commercialisation Option: Evaluate gas-to-power integration as a backup strategy if direct gas export infrastructure remains unavailable or delayed.