Swedish independent oil and gas company Lundin Petroleum reported Wednesday that its operating profit improved for both its second quarter and for the first half of the year as whole. Lundin put the "excellent" performance down to increased production, particularly from its operations in Norway.
Recent days have seen a number of much larger oil and gas companies – such as BP, Royal Dutch Shell and Total – report lower profits that they have blamed on volatile energy prices.
Lundin said that for the second quarter of 2012 it delivered an operating profit (at the EBITDA level) of $271.5 million (2Q 2011: $266.9 million), while for 1H 2012 it produced an EBITDA of $580.6 million (1H 2011: 505.3 million).
First half production of 35,100 boepd was well above forecasts, said Lundin, with strong performances from the firm's share of the Alvhein and Volund fields, offshore Norway. The uptime on the Alvhein FPSO vessel was above forecast, while the Volund reservoir continues to perform better than expected.
Lundin said that production would have further outperformed had it not been for the poor performances of Tunisia's Oudna field, which is to be abandoned following flowline damage, and Indonesia's Singa field, where maintenance work is continuing.
The firm supplied updates on three ongoing development projects in Norway – Edvard Grieg, Brynhild and Bøyla – which it said are all progressing satisfactorily.
Edvard Grieg and Brynhild, both operated by Lundin Petroleum, have received plan of development approval and project execution is ongoing. Major contracts have been awarded for both projects.
The Edvard Grieg field is located in production license 338, where Lundin has a 50-percent working interest. The field contains reserves of 186 million barrels of oil equivalent and Lundin believes it will produce at a gross production rate of close to 100,000 boepd. The firm added that It is likely it will drill an additional appraisal well on Edvard Grieg in early 2013 to target upside reserves volumes in the south eastern part of the field referred to as the "golden zone".
The Brynhild field is being developed as a subsea tieback to Shell's Pierce field facilities located in the UK with first oil forecast for late 2013. The Brynhild field is expected to produce at an estimated gross plateau production rate of 12,000 boepd.
A plan of development for the Bøyla field in PL340 (working interest: 15 percent) was submitted in June 2012. The Bøyla field contains gross reserves of 21 MMboe and will be developed as a subsea tieback to the Alvheim FPSO. First oil from the Bøyla field is expected in 2014 at a gross plateau production rate of 20,000 boepd.
Lundin also noted that it has commenced the drilling of the first of three appraisal wells with well 16/2-13 on the north eastern part of the Johan Sverdrup discovery.
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