EnQuest Sanctions Alma, Galia Development
EnQuest has sanctioned the development of the Alma and Galia fields, subject to anticipated regulatory approvals. This $850 million project will add a fourth hub to EnQuest's existing operating base, will increase EnQuest's net 2P oil reserves by 29 MMboe and is expected to increase EnQuest's production levels to over 40,000 Boepd in 2014.
Medium term production guidance: CAGR of over 20% per annum, 2009 to 2014
EnQuest also issued new medium term production guidance, including the anticipated positive production impact from Alma and Galia. Based on today's guidance, EnQuest would deliver a compound annual growth rate of over 20% per annum between 2009 and 2014.
EnQuest is anticipating average annual production of between 20,000 Boepd and 24,000 Boepd for 2012, between 25,000 Boepd and 30,000 Boepd for 2013 and in excess of 40,000 Boepd for 2014. EnQuest anticipates adding further production through business development opportunities.
Kildrummy farm in
EnQuest has agreed with Talisman Energy to farm in to a 40% interest in the Kildrummy discovery on 15/12b and 15/17 by drilling an appraisal well. The discovery is estimated to contain 40 MMboe of original oil in place in excellent reservoir sands.
Amjad Bseisu, Chief Executive of EnQuest, said, "The Alma and Galia development shows the continuing growth of EnQuest and the breadth and depth of its capabilities, from subsurface to production. The project reuses existing facilities and is designed to ensure that abandonment costs will be minimized. Alma, formerly the Argyll field, was the first oil field in the UK and was abandoned at relatively low water cut using the technology available at the time. With current technology field life can be extended significantly. This type of opportunity fits the EnQuest model of finding fresh opportunities in mature assets.
"The Alma and Galia development provides a material increase of approximately 29MMBoe in EnQuest's reserves and underpins our medium term production growth profile. This is EnQuest's largest new project so far and our fourth hub. We look forward to EnQuest's development and execution team delivering this and other hubs in the future."
Alma and Galia development
- First production is anticipated in Q4 2013, with peak production of over 20,000 Boepd
- Alma and Galia add 29 MMboe of 2P reserves
- Gross capital costs of the project are estimated to be approximately $850 million, with $100 million invested in 2011, this is in addition to EnQuest's underlying 2011 capital investment of approximately $300 million. Over the life of the field operating costs are estimated to be approximately $29 per Boe, significantly less in the early years.
- The development will consist of 7 production wells and 2 water injection/disposal wells, tied back to the modified Uisge Gorm Floating Production and Storage Offloading ('FPSO') vessel. The development plan is designed to be capable of processing high water cut levels up to 95%
- EnQuest anticipates DECC approval of the associated field development plans ('FDP') in the near future
Kildrummy farm in
- EnQuest has farmed in to the Kildrummy discovery on blocks 15/12b and 15/17, subject to normal JV partner and DECC approvals
- EnQuest will earn a 40% working interest (Talisman 40%, ENI 20%) by carrying Talisman's share of the appraisal program, the net cost of the well is estimated at approximately $32 million
- Current estimate of P50 original oil in place is 40 MMboe in excellent sands, 8km from the Piper platform
- EnQuest is to become the Kildrummy Operator (subject to partner approval under the Joint Operating Agreements) and will operate the appraisal well. If the appraisal is successful EnQuest will also operate the subsequent field development project