Premier Oil, an independent oil and gas company, is expecting first oil from the Solan development project, in the UK North Sea, shortly.
In the company’s 2015 annual report on Thursday, Premier said that Solan project is nearing completion.
The Solan development has been a challenging project for Premier since sanction with the commissioning of the platform taking longer than planned largely due to significantly worse than anticipated weather conditions West of Shetlands.
As a result, costs have been higher and first oil is later than originally planned.
The field is expected to achieve initial production rates of 10-12 kboepd following ramp up from the first producer well, with plateau production rates of 20-25 kpoed when the second producer well is completed and tied-in around mid-year.
Cash spend to December 31, 2015, on the Solan project stood at $1.88 billion.
Premier on Thursday posted revenues of $1.1 billion for 2015, compared to $1.6 billion in 2014, and loss after tax of $1.1 billion compared to $210.3 million in 2014, reflecting non-cash post-tax impairments of $583.5 million, due to lower near-term oil price assumptions, principally relating to the Solan field.
Premier’s capital expenditure in 2015 totalled $1.07 billion. The company expects significant reduction in capex spend for 2016, with further reductions in annual spend forecast in 2017.
Premier’s 2016 production guidance is 65-70 kboepd, including a contribution from E.ON. To remind, Premier in January acquired the whole of E.ON’s UK North Sea assets.
Offshore Energy Today Staff