Borders & Southern Petroleum plc said its design had been independently validated for a phased development concept for the large gas condensate offshore discovery of Darwin, south of the Falkland Islands.
DESIGN
The company aims to generate a production profile requiring relatively low initial capital expenditure; deliver accelerated payback; and allow expansion of the production profile from free cash flow.
DARWIN EAST
Borders & Southern said that preliminary development would focus on Darwin East where, based on appraisal well flow rates in line with reservoir modelling expectations, initial production of 26,000 bpd could be achieved from two production wells and one gas injector well.
The company commissioned an independent facilities engineering report which it said validated the development concept.
The report also confirmed that a conventional FPSO development concept could be utilised, typical of global deep water petroleum field developments.
ECONOMIC MODEL
The company estimates capital requirement, excluding contingency, for the drilling, subsea, and project costs to be some $640 million.
Borders & Southern management’s scoping study economic modelling shows that payback could be achieved within two years of first production (assuming $60/bbl oil price), changing to one year at $90/bbl.
The company added that the high-quality reservoir with favourable fluid properties that did not require a large number of development wells, application of a conventional FPSO development and attractive fiscal terms set by the Falkland Islands Government all affected the project economics.
“Following the initial exploitation phase, project expansion could occur from free cash flow by drilling further production wells on Darwin East and the full development of Darwin West.
“Several options have been identified that could, subject to certain assumptions, elevate production towards 70,000 bpd.”