Offshore staff
LONDON – Premier Oil has updated progress on planning for the Sea Lion development project in the offshore north Falkland basin.
The company completed a deal last October, approved by the Falkland Islands government, to farm into the surrounding licenses as the new operator, with an initial cash payment of $231 million to Rockhopper. In addition, Premier will pay an exploration carry of up to $48 million and, subject to approval for the field development plan, a development carry of up to $722 million.
In addition, the two companies agreed to jointly pursue exploration opportunities elsewhere in the Falkland Islands and in analogous plays offshore southern Africa.
TheSea Lion field is on the Falklands Plateau, 220 km (137 mi) north of the Falkland Islands, in 450 m (1,476 ft) of water. The geological setting is a north-south Atlantic failed rift with mainly early Cretaceous to Tertiary fill in a typical half graben structure, with a large bounding fault in the east.
Sea Lion, which is close to the eastern margin, contains stacked early Cretaceous lacustrine fan reservoirs with waxy 28° API crude, and in-place oil estimated at more than 1.1 Bbbl, with 300 MMbbl recoverable.
Development will likely entail drilling and completing subsea wells in manifold clusters tied back via flexible risers to an anchored FPSO. This facility will include water injection, and gas and produced water handling facilities, with produced gas used for fuel or re-injected to boost recovery. Shuttle tankers will collect the crude for shipment to international markets.
Probable capital expenditure for the entire project is $5 billion.
Since becoming operator, Premier has put in place a new project team to perform detailed planning of development drilling and the specification and sourcing of production facilities ahead of starting front-end engineering and design. There have been visits to shipyards to assess FPSO options, either conversions or newbuilds, to meet the design life criteria.
Other reviews have investigated the option of gas lift instead of hydraulic submersible pumps. Design studies of flowline systems have been completed, and health, safety and environmental management plans are being implemented set to safeguard the development and operations phases.
Premier is aiming for concept selection in mid-2013, project sanction in mid-2014, and first oil in 3Q 2017.
As for other prospects on the acreage in the north Falklands basin, the partners have reached a technical agreement on a campaign of three to six exploration wells targeted for 2014/2015, subject to rig availability. These could include play-opening wells on prospects beneath the existing Sea Lion sands, prospects from independent feeder systems along the basin’s east flank, and various Sea Lion “look-alike” prospects.
The government has extended the duration of licenses PL023 and PL024 through November pending further seismic interpretation work, while licenses PL003 and PL004 have been extended to May 2016, with the addition of a one-well commitment.
3/21/2013
