Maersk Oil UK announced Monday that the company had received FDP (Field Development Plan) approval from the Department of Energy and Climate Change for the Balloch oil field, 140 miles north east of Aberdeen in the Central North Sea.
Balloch, which Maersk Oil holds a 100 percent interest in, was discovered in 2010 and is situated close to Maersk Oil UK's highly successful Dumbarton development. Production will initially be through one well and tied back to the Global Producer III FPSO (Floating Production Storage and Offloading facility), which currently produces oil from the Dumbarton and Lochranza fields. The first well is expected to peak around 8,000 barrels of oil per day with first oil in April 2013, and a second well is being planned. The total reserves from the two wells are estimated to be nine million barrels of oil.
The total investment in the two Balloch wells is expected at a level of $226.4 million (GBP 150 million), and potential for further development will be assessed based on the performance of the planned production well, combined with recent encouraging appraisal results.
"We are delighted with this approval as our investment in the Balloch field is part of Maersk Oil's ambitious long-term growth strategy in the UK. Following our acquisition of the remaining 30 percent equity in Dumbarton, Lochranza and Balloch in 2012 from Noble Energy, we have been able to fast track the project, and maximize production through the Global Producer III FPSO, which is core to Maersk Oil's overall production strategy. Currently we have a strong portfolio of development and exploration projects, and are fully committed to bring these on stream in the next 5-7 years," said Managing Director of Maersk Oil UK Martin Rune Pedersen.
"Balloch is an excellent example of a smaller field using existing infrastructure. This type of development will become increasingly important for maximizing oil and gas recovery from the UK Continental Shelf and creating jobs in the supply chain," UK Energy Minister John Hayes said.
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