North Sea independent EnQuest expects to reach first oil on its Alma/Galia development within a few weeks, the firm announced this morning.
The development, a subsea project tied back to the EnQuest Producer floating production, storage and offloading (FPSO) vessel, will help boost 2015 average daily production from 29,665 boe/d in 1H (up 17.3% from 1H 2014) to between 33,000-36,000 boe/d by year end.
The firm, which has been running a program of cost reduction initiatives across its business, says it is also on track to reduce its opex to $30/bbl in 2016 – compared to $45.9/bbl in 1H 2014 – as it adapts to low oil prices. This year, costs have been reduced to $38/bbl.
Despite the efforts, and a 17.3% increase in production, to 29,665 boe/d, the firm still saw drops in revenues and profits, falling 11.9% and 34% respectively.
EnQuest CEO Amjad Bseisu said this was still a good result, given the almost 50% drop in the oil price between 1H 2014 and 1H 2015.
"EnQuest has responded well to the lower oil price environment, delivering a strong performance driven by production gains and cost reductions, both core areas of expertise, and by a well executed hedging program,” he said.
EnQuest says cost reductions are being achieved through substantial direct cost savings and also through the addition of lower cost barrels coming onstream, from a successful drilling program. A more cost efficient equal time rota for offshore staff has been implemented at Thistle, the Dons, Heather/Broom and GKA, reducing fixed personnel costs and associated logistics costs, such as helicopters.
Alma/Galia
Six wells on Alma/Galia are available to be brought onstream in 2H in a phased sequence. Power systems will also be ramped up in a phased manner through 3Q/4Q and EnQuest anticipates the need for a planned field shutdown to complete commissioning of the steam turbine generators. EnQuest should achieve optimized production before the end of the year. Completion of the water injector WI1 is scheduled in 3Q.
Kraken
EnQuest is also progressing its Kraken FPSO project, which it says is on budget and on schedule for first oil in 2017. Batch drilling of the top-holes at the first drill center has been completed. The FPSO, which is in a yard in Singapore, continues to be on track for delivery in 2016. The turret/mooring buoy has been manufactured and is being transported to the field from SE Asia.
The fixed pipelines for the first two drill centers have been installed on the seabed. Installation of the mooring system for the FPSO also started in the first half.
In 2H 2015, following the completion of the Kraken batch top-hole drilling program at DC1, the drilling rig is progressing with the pre-drilling of individual wells into the reservoir. Procurement, manufacture and installation continues in relation to the next phases of wells, subsea infrastructure and the FPSO.
The drilling of an appraisal well in Kraken West in 1Q 2015 confirmed the presence of oil, with potential for upside. Further evaluation is ongoing.
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