E.ON sells UK North Sea field portfolio to Premier

Offshore staff

LONDONPremier Oil has agreed to acquire E.ON’s entire UK North Sea assets for $120 million plus working capital adjustments.

The producing interests include:

  • Elgin-Franklin in the UK central North Sea (5.2%, Total operator) – high-pressure/high-temperature gas/condensate field currently producing 114,000 boe/d with operating costs of around $8/boe
  • Huntington in the same sector (operatorship, interest increasing from 25% to 100%) – currently produces around 15,000 boe/d with remaining reserves of 10 MMboe
  • Babbage in the southern UK gas basin (47%, operatorship) – currently produces from five wells with infield and near-field opportunities.

Premier also gains operatorship of the undeveloped Tolmount, one of the largest gas discoveries in the southern UK sector of the past few years with resources estimated in the range 0.2-1 tcf; and other interests west of Shetland.

As for Premier’s existing UK projects, commissioning work continues at the west of Shetland Solan development, supported by the Superior flotel. However, due to poor recent connectivity with the vessel, first oil has been pushed back to February.

The first pair of producer-injector wells for first oil has been tied in. Following completion of the second injector, the semisubmersible Ocean Valiant drilling rig will side track the second producer this spring.

When both pairs of wells are onstream, production is expected to peak at around 20-25,000 boe/d.

In the UK central North Sea, the Catcher project is on schedule to deliver first oil in 2017. The mooring system for the FPSO is expected to be installed this summer.

The jackup Ensco 100 has completed the first two wells (injectors CTI1 and CCI2) ahead of schedule with good operational performance and reservoir results. Catcher’s third well (the first producer CCP3) has been drilled to total depth, encountering good reservoir quality and is in the final phase of completion.

Fabrication of the FPSO hull and topsides continues in Asia. The first major hull section was delivered in December to the yard in Japan from South Korea.

Topsides module and turret construction is progressing in Batam and Singapore. Commencement of hull and integration work should get under way around mid-year in Singapore.

This year, Premier is restricting its UK exploration program to commitment wells around existing operations in the North Sea.

01/13/2016

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