Hurricane Energy plc, the UK based oil and gas company focused on hydrocarbon resources in naturally fractured basement reservoirs, is pleased to provide an operational update on the Lancaster Early Production System (EPS).
· Lancaster EPS remains on schedule for first oil in 1H 2019
· Hurricane has taken the Final Investment Decision on the development of the Lancaster Early Production System
· Agreements now effective with Bluewater Energy Services for upgrade, lease and operation of the 'Aoka Mizu' FPSO vessel
· 'Aoka Mizu' now on tow to Dubai for upgrade work
· Rig contract signed with Transocean to complete already drilled EPS production wells
· Fabrication orders placed with TechnipFMC for SURF and SPS
· Development and Production regulatory approval expected shortly
Following completion of the equity placing and convertible bond offering announced in June 2017 (the "Fundraising"), Hurricane and its key contractors have proceeded with procurement, fabrication and contracting activities related to the EPS on the Lancaster field. The Company, now fully-funded to reach first oil, remains on track for first oil in 1H 2019.
FPSO Aoka Mizu contract awarded to Bluewater
On 14 August 2017, key contracts between Bluewater Energy Services and the Company outlining terms for the upgrade, lease and operation of the FPSO vessel, 'Aoka Mizu', and associated agreements, became effective in accordance with their terms. These agreements had previously been executed on 23 June 2017. The vessel left Gdansk on 27 July 2017 and is currently on tow to Dubai, where its upgrade is planned to be undertaken. It is expected to arrive by early October. The mooring buoy is also being fabricated in Dubai, where work has commenced.
Rig contract awarded to Transocean
The Company has entered into a contract with Transocean for the Paul B. Loyd Jr. semi-submersible drilling rig to complete the previously drilled Lancaster 205/21a-6 and 205/21a-7Z horizontal production wells, commencing 2Q 2018.
SURF and SPS contract awarded to TechnipFMC
TechnipFMC has commenced procurement and fabrication of the main subsea components of the development including subsea umbilical, risers and flowlines "SURF" and subsea production system "SPS". Subsea installation activities at Lancaster are scheduled for summer 2018, in advance of the planned arrival of the 'Aoka Mizu'.
A TechnipFMC vessel has recently completed a further seabed survey as part of the planning process for boulder clearance around the area planned for SURF installation. The Company is making good progress with the regulatory authorities in relation to the approval of Company's Field Development Plan (FDP) and associated consents and permits for the Lancaster EPS development. Approval is expected shortly, with no impact to overall project schedule anticipated.
Dr Robert Trice, Chief Executive, commented:
"I am delighted that all operational work streams are proceeding on track for delivery of the project within the target timeline of first oil in 1H 2019.
"Successful completion of the Fundraising allowed the Company to move ahead with the upgrade of the FPSO, fabrication of the buoy, and procurement of the subsea components for installation work to begin next summer. We greatly appreciate the contributions of our key contractors and partners, Bluewater Energy Services and TechnipFMC, in progressing the project at pace.
"The Lancaster EPS is not only an essential step in planning for the full field development of the Company's Rona Ridge assets, but also represents a substantial development in its own right, with planned production of 17,000 barrels of oil per day. "We look forward to providing further updates as we move forward with engineering, procurement, installation and commissioning (EPIC) activities; and once regulatory approval is obtained."