Premier Oil has lowered its full-year production guidance to 61,000-64,000 barrels per day from previous forecasts of 65-70 kboepd following problems in its biggest producer Catcher oil field.
In today’s company results, Premier said it had produced on average 62.5 kboepd for the 10 month period ending 31 October 2020.
The hydrocarbon exploration and production company had a net debt of $2.05 billion as at the end of October.
Premier, which has interests in the North Sea, Indonesia, Vietnam, Falkland Islands, Alaska and Brazil, announced at the start of November a proposed merger with Chrysaor to create the largest London listed independent oil and gas company. bit.ly/35lwJc2
The Catcher Area averaged 26.5 kboepd (net, Premier operated 50%) to the end of October. It was shutdown in August and the produced water plant was offline while a build-up of calcium naphthenate was removed in late September and reinstated in early November. There was a fire on 9 November in the electrical equipment (HVAC switchboard) in the main store room on board the FPSO. BWO, the operator of the Catcher FPSO, is working to reinstate the HVAC to enable production “within the next week.”
The third producer Solan P3 was brought on-stream in September with well free-flows of up to 9.5 kbopd and expected to exceed 10 kbopd.
The Elgin Franklin Area produced 6.8 kboepd (net, Premier 5.2%) ahead of budget. An active rig programme with the F13 well was brought on-stream in October.
At Tuna (Indonesia) a farm-out agreement was signed with Zarubezhneft in September. Fully carried two well appraisal programme are planned for 2021.
The company announced there were still options for significant growth at Zama (Mexico).
Premier added that it had “highly encouraging results” from new 3D data sets in Mexico and Indonesia.
Production from Premier’s operated Natuna Sea Block A fields in Indonesia averaged 12.2 kboepd (net, Premier 28.67% interest), in line with budget. Natuna Sea Block A captured a 55.8% market share of gas contract sales GSA 1, higher than its contractual share of 52.5%.
In Vietnam, Premier’s operated Chim Sao field produced 8.7 kboepd (net, Premier 53.125% interest).
Projects in development stage included the installation of a platform in Tolmount and the start of drilling four development wells. Premier forecasts first gas for Q2 2021 and will add 20-25 kboepd (net) once at plateau. The company is in final negotiations on the proposed Tolmount East development with contractors.
In September, Premier was awarded two licences adjacent to its Tolmount Field Development Area and is “maturing a number of leads and prospects” which could be developed via the Tolmount infrastructure.
In Mexico, negotiations regarding the Zama field development plan are expected to conclude in Q1 2021.
In the Falkland Islands, the 250 mmbbl Sea Lion Phase 1 project is on hold while Premier works with the Falkland Islands Government (FIG) on licensing, fiscal and regulatory matters.
In exploration and appraisal stages, Premier signed in September a farm-out agreement with Zarubezhneft for a 50% interest in the Tuna discoveries, Indonesia.
Premier said it had a highly prospective portfolio of opportunities on the new 3D data sets in Mexico and the Andaman Sea, Indonesia, ahead of drilling campaigns in 2022.
Premier also plans to drill the stacked Berimbau/Maraca prospect on its operated Block 717 (Premier 50% interest) in Brazil in 2022.
Tony Durrant will step down as Premier’s chief executive by the end of the year and finance director Richard Rose will stand in until the Chrysaor deal has been completed. Chief operating officer Stuart Wheaton will be interim deputy chief executive.