Lundin Cuts 2015 Production Forecasts

Lundin Petroleum revealed in its 2015 half year results statement that it has cut its production guidance from previous forecasts of between 41,000 to 51,000 barrels of oil equivalents per day to 32,000 boepd. The company also announced in a separate release Wednesday that it has completed a successful appraisal well on the Edvard Grieg field, offshore Norway.

The revised forecast is due to lower than expected production figures from the Brynhild field, located offshore Norway, and Edvard Grieg topside installation delays. After coming online in December 2014, Brynhild produced just over 3,000 barrels of oil per day during the first half of 2015, which was over 60 percent below forecast according to a statement from Lundin CEO C. Ashley Heppenstall. Despite its guidance decrease, Lundin Petroleum is still targeting a 2015 exit production rate of 75,000 barrels of oil per day.

Lundin Petroleum CEO C. Ashley Heppenstall said in a company statement:

“We have seen improvements in production over recent weeks but we have revised our production efficiency forecasts to what we believe are more realistic levels going forward, which coupled with the first half production will have a negative impact on our 2015 production guidance.”

Lundin produced 27.4 million boepd during the first six months of the year, compared to 26 million boepd during the first six months of 2014. Revenue for the first half of 2015 was $279 million, which marked a significant decrease from the company’s revenue of $460 million in the first half of 2014.

The successful appraisal well offshore Norway was drilled to a vertical depth of 6,702 feet, approximately 1.5 miles southeast of the Edvard Grieg platform location. One of the objectives of the well, which encountered a 216 foot oil column with medium to good reservoir quality, was to determine the best possible location for production wells in this area. Initial data results at the well appeared to be "very promising", according to a Lundin Petroleum release.


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