RWE Dea Gets Govt Nod for Breagh Field Development

RWE Dea UK announced that the field development plan for its operated Breagh gas field has received the unconditional approval of the Department of Energy and Climate Change (DECC) of the UK Government.

The FDP approval from DECC was formalized today by Charles Hendry MP, Minister of State for Energy at RWE Dea UK's London office, in a ceremony attended by senior management of RWE Dea and its Breagh license partner, Sterling Resources (UK).

"The FDP approval is a hugely significant achievement for our Breagh gas field development. It is an essential element for the realization of our strategic target to boost RWE Dea's annual gas and oil production to more than 70 million barrel of oil equivalents by 2016," said Ralf to Baben, Chief Operating Officer of RWE Dea AG.

René Pawel, RWE Dea UK's Managing Director, commented, "I am delighted with today's announcement by the UK Government. It means that RWE Dea UK remains on course to achieve production from the Breagh field less than three years after we acquired operatorship of the Breagh license."

The FDP approval marks yet another step in a busy summer for the Breagh development. Around 100 kilometers of 20" pipeline has been successfully installed offshore and the platform is due for installation in early September. The platform is being constructed by Heerema Vlissingen in the Netherlands and consists of a jacket approximately 85 meters tall with a total weight of some 4,000 tons and topsides of approximately 1,400 tons. The platform will be installed by Heerema Marine Contractors.

Energy Minister Charles Hendry said, "This is welcome news, Breagh is one of the largest natural gas discoveries in the Southern North Sea in recent years, and developments like this play a vital role in ensuring we have secure energy supplies throughout the UK. It is also encouraging to see the success of initiatives such as the Promote license, developed through PILOT, which originally allowed Sterling Resources to gain access to this acreage and bring the development forward under the partnership and operatorship of RWE Dea."

The Breagh field is located in UKCS blocks 42/12a and 42/13a of the southern North Sea in 62 meters water depth, approximately 100 kilometers east of Teesside. The field is being developed in two phases. Phase 1 entails gas to be exported via the 20" pipeline from the Breagh Alpha platform to Coatham Sands, Redcar on the UK mainland, and a 10 kilometers onshore pipeline for processing at the Teesside Gas Processing Plant (TGPP) at Seal Sands. The TGPP site is owned by Teesside Gas & Liquids Processing, and after processing at the TGPP, the gas will enter the UK National Transmission System. Phase 2, expected to receive FDP approval in early 2012, is expected to include additional wells in the east of the field drilled from a Breagh Bravo platform tied back to Alpha.

RWE Dea holds 70% interest in the Breagh gas field as operator (Sterling Resources UK 30%). The gas field is a conventional carboniferous reservoir and the expected reserves will make a significant contribution to the growth of RWE Dea's gas production. Further upside potential is expected in the surrounding exploration blocks.