Lundin Petroleum Cuts Full-Year Production Outlook on Brynhild Delay


STOCKHOLM, June 9 (Reuters) – Lundin Petroleum said on Monday oil production from its Brynhild field would likely only get running late in the third quarter, hampering its overall output for 2014.

Production from Brynhild, an oil field situated in the southern part of the North Sea about 10 kilometers from the border with the UK shelf, had been expected to start already in June.

The Swedish oil firm blamed the delay on commissioning issues related to the use of nearby floating production storage and offloading (FPSO) facilities operated by Shell.

"We are disappointed and frustrated that the Haewene Brim FPSO is still not ready to accept Brynhild production," CEO Ashley Heppenstall said in a statement.

"Nevertheless we remain confident regarding the productivity of the Brynhild reservoir and the project delays have had no impact on Brynhild reserves."

Lundin, which explores and produces oil in Norway, Malaysia and Indonesia, said the delay would affect its 2014 net production which it now forecast at 25,000 to 30,000 barrels of oil equivalent per day (boepd), down from a previous expectation for between 30,000 and 35,000 boepd.

Lundin shares traded down a little more than one percent in early trade on Monday compared with the OMXS all-share index which was up 0.9 percent.

Lundin said it would retain a production guidance for 2015 of 50,000 boepd.

According to Lundin, the Brynhild reservoir lies at a depth of 3,300 meters. The field's gross reserves are estimated at 23.1 million barrels oil equivalents and forecast gross peak production is expected to be 12,000 barrels per day.

(Reporting by Mia Shanley; editing by Niklas Pollard)



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