Premier looking to develop Oilexco interests

Premier Oil has issued its first report on its new production interests in the UK North Sea, formerly owned by Oilexco.

Offshore staff

LONDON -- Premier Oil has issued its first report on its new production interests in the UK North Sea, formerly owned by Oilexco.

Late last month, the company completed acquisition of a 100% interest in the Caledonia field, the result of an agreement initiated by Oilexco. Although largely watered out, Caledonia has further production potential. Premier is engaged in technical studies and tariff negotiations with a view to a decision on further development by year-end.

Unitization negotiations and development concept selection are also under way at Huntington, one of the larger discoveries in the Oilexco portfolio. Premier expects these to be completed by the end of the year, leading potentially to an early development sanction.

On the Shelley field, a diving support vessel is on location connecting two suspended production wells to the Sevan FPSO and installing the control umbilical. The work should be completed by end-July. Premier expects an initial production rate of 10-12,000 boe/d, but longer-term performance is uncertain due to the field’s complex geology.

At Balmoral, measures are being taken to increase capacity of the gas-lift and water handling systems and to accelerate riser replacement. The program should be completed after the summer shut-down period.

Production from Nicol, a subsea tieback to the Balmoral FPU, is currently restricted by bottlenecks in the offtake system. Premier is working to optimize the Brenda-Nicol subsea multiphase pump and to increase its capacity. Following completion of the work this fall, the company will look to drill a new infill well on Brenda.

Elsewhere in the North Sea, the company is a partner in the Froy field in the Norwegian sector. Discussions are under way with two other operators in the area to evaluate joint development opportunities which might improve Froy’s economics.

07/10/2009

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