Northern Offshore announced that production had begun at the Northern Producer, a floating production facility owned by Qualimar Shipping Company Limited, a subsidiary of Northern Offshore. The Northern Producer will serve the West Don and Don Southwest fields operated by Petrofac Energy Developments in the U.K. sector of the North Sea.
The Northern Producer earns a tariff, indexed to the price of oil, on each barrel of oil that crosses the platform. The operator has announced that production from the West Don field, which commenced on April 28, 2009, is expected to peak in the range of 25,000 barrels of oil per day. Additionally, production from the Don Southwest field is anticipated to commence in mid-2009. Petrofac expects peak production from both fields combined to exceed 40,000 barrels per day.
"We will enjoy significant upside as oil prices improve," said Marion Woolie, Northern Offshore president and CEO. "The company can earn between $2.00 and $6.00 per barrel of production, depending on the level of oil prices. At $50.00 oil, our tariff is $3.50 for each barrel of oil crossing our platform."
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