Alpha Petroleum has agreed an exclusive deal with General Electric’s oil and gas arm to develop one of the largest untapped North Sea fields.
The privately owned operator will partner up with GE Oil&Gas to set up subsea infrastructure which will allow an FPSO to tap into into the Cheviot oil field, East of Shetland.
First oil is expected in 2019 at an expected rate of at least 30,000 barrels per day.
It is one of the largest undeveloped fields in the UK North Sea with 55 mmbbls of oil and 20 mmboe of future gas production.
GE Oil & Gas will be the exclusive supplier of early engineering, project management, and procurement activities for the project.
This includes providing the operator with subsea trees, a full control system, three manifolds, flexible jumpers, flowlines, risers, umbilicals as well as subsea construction and installation services, and support commissioning.
GE Energy Financial Services is helping to raise the needed debt financing for the project and is in discussion with Alpha Petroleum with the intention, subject to due diligence, of making a significant capital investment at the time of final investment decision (FID)
FID is expected in the fourth quarter of 2017.
Andy Crouch, Alpha Petroleum’s chief executive officer (CEO) said: “By taking this unconventional, collaborative approach, we have been able to really draw on GE’s expertise, enabling us to
minimise costs and timescales.
“This partnership marks another key milestone in Cheviot’s development and we are excited to see the project move forward to the next stage.”
GE Oil & Gas Europe CEO, Michele Stangarone, added: “Through this full life-of-field partnership, Alpha Petroleum is defining the performance characteristics they require and empowering GE Oil & Gas to design the necessary solutions.
“While the benefits are clear, this represents another very positive example of how the traditional, transactional relationship between industry players is evolving into a partnership approach.”
The Cheviot field is 100 per cent owned by Alpha Petroleum and its core development will consist of 18 firm and 5 contingent wells.
Alpha Petroleum recently announced an exclusivity agreement with Teekay Offshore Partners L.P. on the project for use of its Varg Floating Production Storage Offloading unit as well as FEED capabilities to the project.