NORTH Sea-focused Serica Energy has suffered a setback which highlights the challenges concerned in producing oil and fuel from the type of mature belongings majors are cooling on.
However, Norwegian large Statoil has proven religion within the potential to make extra massive finds off Scotland because it steps up exploration exercise within the Moray Firth with a relative minnow, Jersey Oil & Gas.
London-based Serica is dealing with the prospect of extended disruption to manufacturing from the Erskine area east of Aberdeen after a pipeline blockage proved more durable to deal with than anticipated.
In January Serica introduced manufacturing from Erskine had been suspended following a blockage on the pipeline used to deal with the output from the sector.
It mentioned yesterday the blockage seemed to be resulting from a deposit of wax. The operator of the pipeline, Chrysaor, has been unable to realize a big breakthrough in its makes an attempt to resolve the issue.
The companions within the area have determined to finish clearance operations and focus as an alternative on laying a brand new 26km size of pipeline to bypass the zone affected by wax deposits.
Production is anticipated to restart anticipated in September, that means Serica might need to spend round eight months with out producing any earnings from Erskine. It confronted pipeline issues related with the sector final 12 months. Production from Erskine was suspended from February to July after a cleansing gadget obtained caught within the line.
The firm solely purchased into Erskine in June 2014, when it acquired BP's 18% stake within the area for round £10m, beneath the management of govt chairman Tony Craven Walker.
BP and Royal Dutch Shell have accelerated efforts to chop publicity to mature North Sea belongings in response to the sharp fall within the crude value since 2014.
They imagine they’ll generate higher returns from investing in massive new initiatives in areas akin to West of Shetland than in fields which have been in manufacturing for years. These could also be linked to services which have been in place for many years.
Chrysaor acquired an curiosity in Erskine with the portfolio of North Sea belongings it purchased from Shell final 12 months for as much as $three.eight billion.
Production from the sector is processed on the Lomond platform which was commissioned in 1993.
Sector watchers hope transfers of possession will assist increase funding within the North Sea.
Serica chief govt Mitch Flegg mentioned it was disappointing efforts to clear wax from the pipeline had been unsuccessful.
However, he famous Serica is ready to cut back its reliance on Erskine beneath a deal to accumulate pursuits in three different North Sea fields from BP, for as much as £52m.
“One of the important thing causes for Serica’s acquisition of BP’s pursuits within the producing Bruce, Keith and Rhum fields is to diversify Serica’s manufacturing,” mentioned Mr Flegg.
The deal was agreed in November and is because of full within the third quarter.
Jersey Oil & Gas and Statoil have determined to spend money on buying superior seismic survey info on the licence containing the Verbier discover they made in October final 12 months.
Statoil has mentioned the discover may include as much as 130 million barrels.
The discover has generated nice pleasure within the trade. It supplied a coup for Jersey Oil & Gas,which persuaded Statoil to purchase in to the licence.
Jersey’s chief govt Andrew Benitz mentioned the companions had agreed a deal beneath which they’d have the ability to acquire state-of-the-art, broad-band seismic information at very beneficial charges.
He famous: “We imagine this represents an thrilling step … with the well timed supply of the processed information facilitating the potential future growth of the Verbier discovery in addition to enhancing our understanding and analysis of different drillable prospects within the better licensed space.”
Aim-listed Jersey and Serica have market capitalizations of round £45m and £230m respectively.
Separately Nick Terrell, who’s managing director of private-equity backed Azinor Catalyst, has joined the board of Oil & Gas UK.
The trade physique mentioned Mr Terrell’s appointment mirrored the latest inflow of unbiased operators into the UK North…