Hurricane Energy plc said it remained positive over an extension to the FPSO as the company announced improved finances and production at its Lancaster field, West of Shetland.
PRODUCTION
Production was higher than expectations during October due to better than expected uptime on the FPSO.
The company had anticipated the well gauge pressure would reach the bubble point by the end of Q1 2022.
“While uncertainty remains, analysis of the most recent trends indicates that this point is now anticipated between late December 2021 and mid-February 2022,” said Hurricane in a statement.
“As of 14 November 2021, Lancaster was producing c.10,150 bopd from the P6 well alone with an associated water cut of c.37%.”
The 25th cargo of Lancaster oil, totalling some 530 Mbbls, was lifted on 9 October 2021.
The next cargo lift is expected late-November to early-December 2021.
FINANCES
As of 31 October 2021, Hurricane had net free cash of $99 million including the revenue from the lifting during October 2021 (September: $73m).
FPSO
Hurricane added it remained in positive negotiations with Bluewater (Aoka Mizu) B.V. over an extension to the Aoka Mizu FPSO charter beyond June 2022.
However, the company might need to ring-fence material additional funds as security for the extension of the contract.
Changes to decommissioning estimates could also result additional funds being placed into trust and classified as restricted cash in order to satisfy the Oil and Gas Authority.
The potential transactions would reduce the amount of free cash available to repay the convertible bond principal of $152m due in July 2022.