A fresh investment of £140million has once again extended the life of a North Sea oil field, safeguarding 70 jobs in the process.
Spirit Energy and partner Dana Petroleum have announced plans to drill a new well at Chestnut, around 125miles north-east of Aberdeen, which could keep it producing as far into the future as 2023.
The contract for Teekay’s Hummingbird floating production, storage and offloading (FPSO) vessel has also been extended through to 2023.
It follows a similar investment in 2017 when Spirit injected £35m into the field with the third production well, which would have otherwise have seen Chestnut shut down.
When the field was first sanctioned more than a decade ago it was expected to produce for just two years.
It was initially expected to produce seven million barrels of oil in that time but fresh investment from the partners has seen it since export more than 24million barrels.
Drilling at the new well, the fourth production well at Chestnut, will begin before the end of the year.
Neil McCulloch, executive vice-president technical and operated assets, said: “Over time and with new technology we have understood more about the properties of the Chestnut reservoir. Rather than rest on our laurels, I am proud that we have gone further and secured the future for the offshore crews while extending the life of an important field for us.
“This is a good example of MER UK in practice and an asset being in the right hands.
“The work our teams have done alongside our partner Dana and our supply chain colleagues to maximise the potential of the Chestnut field has been exceptional, and we now look forward to starting drilling before the turn of the year.”
The Chestnut field is operated by Spirit Energy (83%) alongside partner Dana Petroleum (17%).
A Dana spokesman said: “Dana is pleased to be working with our partner Spirit Energy and the supply chain to extend the life of the Chestnut field.
“We look forward to further years of safe and stable production which maximise recovery from this field.”
Production from the project first began in 2008.
Kenneth Hvid, Teekay’s chief executive, added: “We are pleased to announce this important multi-year FPSO contract extension for the Hummingbird in connection with our customer’s new drilling program, further extending the production of the field in the North Sea which originally commenced in 2008 and follows several contract extensions with the Chestnut Joint Venture.”