Bahamas Petroleum has delayed its plans to drill an exploration well offshore The Bahamas, citing the impact of the coronavirus on operations.
Previously planned to spud in April 2020, the #Preseverance 1 exploration well is now anticipated to be spud in late May or early June, „as a result of the rapidly unfolding impact Covid-19 is having on operations.“
“As shareholders will be aware, in recent weeks there has been a material adverse change in the global operating environment, characterized by the rapid spread of the Covid-19 virus and the extraordinary, unprecedented worldwide response to this issue,” the company said.
Bahamas Petroleum said the limitations and disruptions in the global supply chains the virus outbreak has created challenges for its drilling plans.
Namely, Bahamas Petroleum said that there are challenges in terms of determining a mobilization window for a drilling rig where continuity of operations throughout a 45 to 60-day drilling campaign can be assured.
Also, there’s an impact on the ability to plan for free movement of mission-critical personnel to and from the drilling rig during operations.
More broadly, Bahamas Petroleum said that the situation is also impacting the ability to finalize the selection of an appropriate drilling rig to be available at the right time in the place required.
If not June, then October
Also worth noting, the oil firm has warned that, given the uncertainty created by the pandemic, should the June window be missed, the next practical window to start drilling would be mid-October.
It said: “…to the extent the current adverse circumstances in the global operating environment persist, resulting in continued deferral of commencement of operations until after early June 2020, the next practical window to prudently commence operations (i.e., post the peak risk period of the Hurricane season) would be from mid-October 2020 onwards.
"The Company stresses that this is not the Company's planning objective, but the Company is seeking to develop a prudent "back-up" plan on this basis, so that in any credible scenario the Company can realistically meet its primary license obligation - i.e., an initial exploration well in 2020.”
Bahamas Petroleum said Monday that, notwithstanding the recent decline in oil prices, farm-in discussions in the context of the Company's overall funding strategy continue to advance.
Simon Potter, Chief Executive Officer of Bahamas Petroleum Company, said: "We have made consistent progress toward drilling of the Company's 100% owned and operated Perseverance #1 well, targeting recoverable prospective resources of 0.7 - 1.4 billion barrels of oil. As a prudent operator, our primary objective is a safe well, best delivered by the ability to drill uninterrupted by external events for the period of the drill plan. Such a continuous operation is also the most cost-effective.
"It is in this context that we have had to reassess the timing for commencement of drilling given the widespread disruption being caused by the global response to the Covid-19 virus.
"Whilst incredibly frustrating given all the hard work undertaken to get to the current state of drill-readiness, the responsible thing to do is to slightly reschedule commencement of operations, to later in 2Q 2020, to a time when continuous delivery of operations can be better assured whilst also still enabling operations to be completed before the peak risk period of the Bahamian hurricane season.
"Pleasingly, farm-out discussions in the context of our overall funding strategy continue to advance. We will update shareholders as appropriate over the coming weeks."
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