Goddard beefs up IOG’s southern North Sea gas project

Silhouette of an oil rig
Oil and Gas UK published a business outlook report earlier this week

Independent Oil and Gas (IOG) has added its Goddard discovery to its flagship development project in the southern North Sea.

IOG’s “core project” included the development of gas reserves at the Blythe and Vulcan hubs.

The addition of Goddard, and its 108 billion cubic feet (bcf) of gas, means the project comprises 410 bcf across six discovered gas fields.

London-listed IOG intends to submit a field development plan for the scheme in the first half of 2019.

The firm said phase 1 pre-final investment decision (FID) engineering had been completed.

The recently-acquired Thames Pipeline, which will export gas from the fields, has passed various checks, and letters of intent are in place for a number of key tasks.

Funding plans are “advancing”, meanwhile.

First gas is slated for delivery within 20 months of FID.

IOG chief executive Andrew Hockey said: “The integration into our Core Project of 108 BCF 2C Contingent Resources at the newly awarded Goddard discovery makes what was already a very strong investment case even more compelling; our fully-owned and operated southern North Sea gas development project now carries a base case IRR of 40% and post-tax NPV of over £350m.

“The award of Goddard to IOG in the highly competitive 30th  licensing round was a big win for us – we consider it one of the most valuable remaining undeveloped UK SNS fields and an ideal fit for our portfolio, lifting our Core Project’s projected peak production rate as high as 146 MMCF/d (c.25 kBoe/d).

“We assess the main part of the Goddard structure to be technically ready for development and with 108 BCF 2C Contingent Resources it will be the largest field in our Core Project, which can now deliver a total of over 400 BCF of gas into the UK market.

“At the outset of 2019, our focus is to deliver funding for Phase 1 of our Core Project thereby reaching FID at the earliest opportunity.

“We are technically and commercially prepared for project execution having made a head start on relevant offshore site surveys.

“In addition, the Core Project does not yet include the potential upside of Harvey, which subject to successful appraisal could add another 129 BCF Best Estimate Prospective Resources. We look forward to providing further updates on Harvey in due course.”

 

Breaking