Premier Slashes 2013 Production Guidance

UK independent Premier Oil has slashed its production guidance for 2013 due to problems with pipelines at projects offshore UK and Vietnam.

Reporting its interim management statement Wednesday, Premier said that it now expected average production for 2013 to come in at between 57,000 and 59,000 barrels of oil equivalent per day (boepd). This compares to a forecast of 63,000 boepd it made in July.

Premier said that production from its Huntington field in the North Sea has been constrained since mid-September following operational issues on the BP-operated CATS gas export pipeline. In Vietnam the Chim Sáo field – which recently reached a milestone of $2 billion of oil revenues – saw gas export interrupted following damage to a flange connecting the Chim Sáo export pipeline to the Nam Con Son Pipeline (NCSP).

Premier said that both issues are expected to be resolved shortly.

At the Huntington field, operator E.ON is working closely with BP to address the issues with production restrictions hopefully being lifted progressively from early November.

At Chim Sáo the leak has been made safe. Premier said that the execution of the repair is under way and, subject to weather, a return to gas export is planned for November.

Premier Chief Executive Simon Lockett commented in a company statement:

"While our oil production is currently restricted by gas export issues in both Vietnam and the UK, this has limited impact on the long term value of those fields.

"Plans are in place to address these issues. In the meantime, we continue to make good progress on our operated development portfolio, on realizing value from pre-development assets and on upgrading the potential of our exploration program."



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