Serica Energy plc faces a £3 million cost for an expected six-week delay in drilling due to equipment failure and mobilisation of a replacement at the North Eigg exploration well in the North Sea.
TESTING
The company said that operations had been progressing successfully despite some drilling delays in the top-hole sections.
“During recent preparations for drilling the third section of the well there was a failure of a vital piece of rig equipment during routine pre-job testing.
“A replacement has been sourced and planning is underway to transport this to the drilling rig.”
Serica added that results from the well would be available in December 2022 and that the delay would have no impact on the geological outcome of the well.
The company expects all well costs would benefit from investment allowances under the energy profits levy.
SIGNIFICANT
“The technical delays encountered on this project are extremely frustrating but do not impact either the chance of success or the significant prospective volumes of this exploration prospect,” said chief executive Mitch Flegg.
He added that the North Eigg high-impact exploration well was the latest in a series of investment projects aimed to increase production in an “environmentally sensitive manner”.
The programme is also designed to help increase the UK’s security of supply and reduce its reliance on imports.