UK-based Independent Oil and Gas (IOG) has completed the acquisition of the Thames pipeline located in the Southern North Sea (SNS).
IOG signed a sale and purchase agreement for the acquisition of the recently decommissioned Thames Gas Pipeline for a nominal consideration from Perenco, Tullow Oil, and Spirit Energy back in April 2017 , aiming to use the pipeline as an export route for its Southern North Sea assets.
The company said on Tuesday that it was now the 100-percent owner and operator of the Thames pipeline.
According to the company, the recommissioning of the pipeline is an essential part of the development of the Blythe and Vulcan Satellite hubs, allowing gas export to the Bacton Terminal.
Peak production from the Blythe and Vulcan Satellite hubs is expected to be 180 million cubic feet per day with opportunities for additional gas under consideration.
Ahead of first gas, the company intends to acquire the onshore reception facilities at the Perenco Bacton terminal. A period of exclusivity has been agreed until the end of September 2018.
Furthermore, in an operational update on Tuesday, IOG said that the Intelligent Pigging Programme (IPP) on the Thames pipeline is underway with onshore mechanical preparation work at Bacton starting on February 20, 2018. The intention of the IPP is to confirm the feasibility of safe reuse of the pipeline, which is estimated to have an initial capacity of 300 MMcfd. Initial results of the IPP are expected early May.
IOG added that an offshore site survey along the Thames pipeline and survey of all proposed platform locations and intra field connecting pipelines was nearing completion.
Positive initial site survey results suggest a modified proposed tie-in point for the Thames pipeline which should reduce time and cost both for the pigging operations and subsequent tie back to the planned Southwark platform.
Andrew Hockey , CEO of IOG, said: “This acquisition is an essential milestone towards final investment decision for our gas hubs. Subject to the IPP results, this pipeline should allow for the tariff-free export of our 100% owned gas reserves that were otherwise stranded.
“Recommissioning of the pipeline may also facilitate the export of new resources that IOG may access and develop in future as well as other gas resources owned by third parties, who would pay a tariff. We are pleased also to be making good operational progress as we head towards final investment decision and look forward to providing further regular updates.”