Northern Petroleum Begins Gas Flow at Brakel Field
Northern Petroleum announced that commercial gas production from the Brakel field commenced on 23rd September 2010. This is the third of six onshore oil and gas fields that Northern and its partners are bringing into production. The forecasted contracted gross sales volume is 200,000 normal cubic meters per day (7.4 mmscfd or 1,280 boepd).
Based upon the August 2010 Gasunie price and the calorific value of the Brakel gas measured during testing, a price slightly in excess of Euro0.21 per normal cubic meter would currently be achieved. Some condensates will also be produced for sale. Northern, the operator has a 45% license interest. Our Partners, Energie Beheer Nederlandse B.V. ("EBN"), the Netherlands' state oil company and
Dyas B.V. ("Dyas"), hold 40% and 15% interests respectively.
This brings into production the third gas field and pipeline development under a 2005 agreement between Northern and Nederlandse Aardolie Maatschappij (NAM), the joint Shell/Exxon company in The Netherlands (announced 14th June 2005).
The next task is to complete the work started in August 2010 on production facilities for the nearby Wijk en Aalburg discovery on the same license. It is a similar facility to that at Brakel and is now scheduled for start-up in early 2011. That will conclude Northern's first multi-field gas development program (Grolloo, Geesbrug, Wijk en Aalburg and Brakel). Northern will then focus on bringing the Papekop and Ottoland oil fields into production.
Production from the four gas fields is scheduled at a gross daily production capability of 720,000 m³ per day (approx. 26.8 mmscfd), about 2,075 barrels per day of oil equivalence net to Northern, and is in addition to a forecast net 190 boepd from the Group's four other production sites in the UK and The Netherlands.
Northern Petroleum Plc has 91,887,701 million ordinary shares in issue and a share price of 94p at close of trading on 24th September 2010.
Derek Musgrove, Managing Director, Northern commented, "We are pleased that we have found solutions to the local environmental
concerns for three new field developments in The Netherlands. We have Wijk en Aalburg, Ottoland and Papekop in progress, and based on our experience move forward with confidence. The next phase of developments under consideration for appraisal and development includes Ottoland North, Kerkwijk, Willeskop, Oppenhuizen and Woudsend, with further production wells in the Geesbrug field and, if tests are successful, Tiendeveen.
Progress has at times suffered from frustrating delays. It might feel as if we are approaching the end of a project. It is however just the end of the first phase of developing the 42.5 million boe of net proven plus probable currently attributable reserves and beyond that starting to move forward on the discoveries acquired since 2005. Nevertheless, when the forecasted net production of over 2250 boepd once Wijk en Aalburg is on-stream is achieved, we will have reached a good base for advancing overall growth of the Group.
We have had tremendous support from NAM and our partners EBN, and Dyas during this process and would like to thank all those who have worked closely with us to reach this milestone.
We now have gas production from five fields in the Netherlands, Geesbrug, Grolloo, P12, Waalwijk and Brakel. The increasing revenues from production will be re-invested in working towards realizing the potential value of the considerable inventory of assets in our possession, continuing our growth."
Chairman of the Executive Board of EBN, Jan Dirk Bokhoven said, "I congratulate Northern Petroleum with this achievement. Bringing this gas field on stream was a challenge and I am happy to say 'a job well done.' Getting more fields like this on production aids EBN in achieving its' objective to produce 30 bcm by 2030 from small fields."
Peter Veenhof, Managing Director of Dyas also commented, "We are pleased that Northern Petroleum has now progressed its third development of a small onshore gas field that was previously classified as a stranded asset."
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