Hurricane Energy’s landmark oilfield development west of Shetland is “on time and going according to plan”, the firm’s boss has said.
Hurricane has now taken a final investment decision (FID) on an early production system (EPS) on the Lancaster field, with final regulatory approval expected to follow “shortly”.
London-Listed Hurricane said the EPS, expected to produce 17,000 barrels of oil per day over an initial six year period, would help the firm decide whether to move onto “full field development” on Lancaster.
The business is also fully-funded to reach first oil, having raised about £400million through the placing of convertible bonds and shares in June.
Robert Trice, Hurricane’s chief executive, confirmed yesterday that resource estimates for the wider Greater Lancaster Area would be published by the end of the year.
Analysts have estimated that the area, which includes the Halifax well, could contain 1billion barrels of oil, which would make it the biggest North Sea find since Buzzard in 2001.
Mr Trice also said he was certain the company would need to expand its Aberdeen presence.
The Surrey-headquartered firm’s current staffing plan is to have 14 people in its Aberdeen office by 2018, compared to three at present.
“We will need to take on the required expertise for the field development and that process is on-going,” Mr Trice said. “As we grow and prove the EPS, staffing will grow organically.”
He also said contractors used by Hurricane will have a lot of Aberdeen-based employees.
“We’re using a strong Aberdeen presence,” Mr Trice said, adding: “Without Aberdeen, there’s no Hurricane.”
For the Lancaster EPS project, Hurricane has contracted Netherlands-headquartered Bluewater Energy Services for upgrading the Aoka Mizu floating production, storage and offloading vessel. It is expected to arrive at a yard in Dubai early next month.
TechnipFMC has started work on the main subsea components of the development and Transocean will complete the two horizontal production wells on Lancaster next summer
Mr Trice added: “We’ve taken FID and things are moving on. The vessel is only a couple of weeks away from its port in Dubai and we have just completed a bunch of seabed surveys for the pilings.
“We’re just about to start some other seabed work regarding boulder clearance, so we are on the case, we are on time and everything’s going according to plan.”
Mr Trice also said the FID on the Lancaster EPS could boost North Sea industry at a time when few new projects are being sanctioned.
He said: “The feedback we’ve had is that there are no new projects coming in. But Lancaster is new – it’s a new play.
“What we’re doing in the first phase is proving this new play has commercial oil.
“If we’re successful, even in our base case, we think this will add meaningful growth west of Shetland and in Aberdeen.
“If we are right, even half way, potentially the Rona Ridge (where Hurricane’s acreage is concentrated) could act as an infrastructure hub for other discoveries west of Shetland.”