North Sea independent EnQuest has cut the cost of its Kraken heavy oil development in the North Sea by a further US$150 million, thanks to progress on the drilling campaign and subsea workscopes.
The cost of the development, which will see a floating production, storage and offloading vessel deployed at the Kraken field, will be reduced to about $2.9 billion, says the firm.
The project, costs on which had already been reduced by $425 million, since project sanction, also remains on schedule, with first oil anticipated in H1 2017.
Sail away of the Kraken FPSO, from Singapore-based Keppel Offshore & Marine's yard to Malaysia's Bumi Armada is expected in H2 2016. It will be the Malaysian oilfield service company's first FPSO in the North Sea.
Meanwhile, the subsea installation program in the North Sea is complete with all three drill centers fully connected to the STP buoy ready for hook up to the FPSO. One short program is planned to install the last mooring pile and wire/chain.
A total of four producer and four injector wells have been drilled and completed, with results meeting or exceeding pre-drill predictions. A potential deal to farmout 20% equity in Kraken to Delek Group is being worked on.
Amjad Bseisu, EnQuest's CEO, said: "The Kraken FPSO is on track for sail away in H2 2016, with its full cycle gross capex costs now reduced by a further c.$150 million to c.$2.6 billion."
First oil from EnQuest's Scolty/Crathes tieback to the Kittiwake platform is also ahead of schedule and under budget, with first oil now expected around the 2016 year end.
A planned shutdown is currently taking place, allowing essential tie-in work to be carried out in preparation for first oil.
EnQuest also confirmed oil on the Eagle exploration well, also in the Greater Kittiwake Area. It is expected to be a low-cost commercial tieback.
In its operations, unit opex is at $23/bbl. Full year unit opex is now expected to be around the lower end of the $25-$27/bbl guidance, says EnQuest in its half year results.
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Image: The Kraken development. Image from EnQuest.
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