Negotiations continue with service providers for the Premier Oil-operated Sea Lion development in the offshore North Falkland basin. According to partner Rockhopper Exploration, Phase 1 will develop around 220 MMbbl in license PL032 and a further 300 MMbbl from the license’s remaining resources under Phase 2.
In addition, there is 200 MMbbl of near-field exploration potential that could be included in either development. Phase 3 will focus on the Isobel/Elaine fan complex in the south of PL004, subject to further appraisal drilling.
The partners are working on a conventional FPSO development scenario with around 23 subsea wells, at an overall estimated cost to first oil of US$ 1.5 billion.
To date they have signed letters of intent for provision of the FPSO, the drilling rig, well services, subsea production systems, and helicopter services. These will be converted into letters of award as the sanction process progresses.
The field development plan is now substantially agreed, Rockhopper added, and discussions continue with the Falkland Islands government on obtaining the necessary consents and agreements to attain a final investment decision.
'We continue to work closely with the operator to progress Sea Lion and, while much work still needs to be done to finalize the funding of the development,' chairman David McManus said.
'With oil prices currently above US$75 per barrel we are focusing all of our efforts on doing everything possible to allow project sanction to take place next year.'
'Notwithstanding the increased activity and spend on Sea Lion, the company continues its ongoing focus on cost control and has maintained a strong balance sheet with cash resources at mid 2018 of US$ 46m and no debt.'
Elsewhere, the company is a partner to Eni in the Guendalina gas field offshore eastern Italy, where production is declining. Efforts continue to reduce operating costs through optimization of water disposal.