The floater would be used to develop theCheviot oil field in the UK northern North Sea.
During the period of the exclusivity agreement, the two parties will negotiate a lease and operate contract for the field’s lifespan.
Alpha aims to secure sanction for the development this summer and is targeting first oil in 2019 at a rate of at least 30,000 b/d.
Development calls for a minimum of 18 wells, comprising 13 producers, two water injectors, and two gas injectors. One of the production wells will be in the satellite Peel oil reservoir.
There are options to employ additional processing capacity on the FPSO which would allow infill wells to be added to increase ultimate recovery.
Based on historical production data and new 3D seismic surveys, Alpha believes recovery would be maximized through re-injection of produced gas and water and use of horizontal wells to minimize drawdown.
Andy Crouch, Alpha Petroleum’s executive chairman, said: “Alpha’s collaborative approach with contractors has resulted in a project that is economically robust in a low oil price environment, minimizes our delivery risk and time to first oil, and meets the UK government’s MER [maximizing economic resources] requirements.
“We are focused on creating long-term value by…building a hub around the Cheviot field to unlock further upside in nearby undeveloped discoveries.”
The FPSO, which had an average 98% availability at Talisman’s Varg field in the Norwegian sector, was chosen because of its reliability in service and the likelihood of minimal modifications/FPSO work to meet the anticipated 10-year project life on Cheviot.
Alpha Petroleum is backed by Petroleum Equity, an alternative investment firm established in 2012.