Additional drilling at Gabon’s Dussafu Marin licence has been deferred because of coronavirus, BW Energy has said, blaming international travel restrictions.
The DTM-6H well was completed in March and it had been scheduled to be connected to the BW Adolo floating production, storage and offloading (FPSO) vessel in June. It is now unclear when this may happen and BW Energy said it had also suspended plans for the DTM-7H well and a following exploration well.
Delays on the DTM-6H well have led the companies working on the licence to scale back production hopes by around 10% for the year.
Production is coming from four wells at a rate of 17,500 barrels per day of oil gross. In the first quarter, the company lifted one cargo from the field at an average price of around $33 per barrel, while the production cost – excluding royalty – was $21.8 per barrel.
Dussafu is expected to produce at 15,000-16,500 bpd gross this year, from 11,800 bpd in 2019. Operational expenditure will fall to around $16-18 per barrel, versus $21 per barrel in 2019.
BW Energy said in March it would push back its next phase on the project, Ruche Phase 1. Spending this year will now be around $115mn, of which $49mn had been spent by the end of March.
“Our business model enables us to quickly adapt to changing market conditions, preserve financial solidity and sustain low oil prices. When markets normalise, we can quickly resume development activity and increase production,” BW Energy’s CEO Carl Arnet said.
The company is in talks on securing a reserve-based lending (RBL) facility with a syndicate of banks, for $200mn and an accordion of $100mn.
BW Energy works on Dussafu Marin with Tullow Oil and Panoro Energy. The latter also gave an update on its Tunisian work, saying domestic sales in the North African state had reached 27,000 barrels in the first quarter at an average price of $54 per barrel. A lifting in April, for 90,000 barrels, was priced at just $19 per barrel.
Panoro said it had another $5mn to spend on capex in Gabon this year. All work in Tunisia has been paused while it waits for things to go back to normal.