Premier Oil has taken over 100% interest in its Solan field development West of Shetland as the project nears first oil.
Premier says the Ocean Valiant rig has arrived at the Solan field and drilling of the second pair of producer-injector wells is due to start imminently, with first oil still targeted for 4Q this year.
Progress on the project comes as the London-based operator has acquired partner Chyrsaor’s 40% interest in return for restricted annual royalty and NPI payments.
Separately, Premier has entered into a $100 million agreement with FlowStream Commodities, subject to Department of Energy and Climate Change approval. FlowStream will make a $100 million upfront payment to Premier in return for the proceeds from 15% of Premier’s production from the Solan field for a period of time, the duration of which is dependent on the Solan field’s production levels and future oil prices.
Premier CEO Tony Durrant says: “The agreement with Chrysaor enables us to focus on delivering first oil from the Solan project without partner funding concerns, while the transaction with FlowStream reduces our balance sheet exposure to the project and releases capital to fund completion of the development. We continue to look at further opportunities to realize value from the project.”
