Premier Oil, a London-listed oil and gas company, has reiterated its expected final investment decision date for the Tolmount gas field in the North Sea will be the first half of next year.
The independent oil and gas producer and explorer said on Thursday that offshore and onshore FEED on the Premier-operated Tolmount field in the Southern Gas Basin was ongoing.
The development concept has been selected and comprises a standalone platform with an export gas pipeline to shore.
The original Tolmount discovery was made by E.ON in 2011. The Tolmount then became a part of the Premier Oil portfolio after Premier bought E.On’s UK North Sea assets in early 2016 for $120 million.
“Following FEED and tendering of the major project scopes which will commence shortly, development sanction is planned for the first half of 2018. Alongside the FEED process, Premier continues to seek ways of enhancing returns and reducing upfront capex on the project and is engaged with an infrastructure partner regarding the possible funding of the development,“ the company said on Thursday.
According to Premier Oil, subsurface studies on Tolmount East and Tolmount Far East continue ahead of any future appraisal drilling.
At the time of the acquisition, the company dubbed the Tolmount as “one of the largest discoveries in the Southern Gas Basin in recent years with estimated gross resources of 200Bcf-1Tcf.”
Premier Oil is the operator of Tolmount with a 50 percent stake. The company has previously said it might farm out a 20% interest in the project.
The company’s annual report 2016 shows the initial phase of the development, which will target the Tolmount main structure, will recover 540 Bcf (P50 estimate) of gas from four producing wells. It is estimated that capex to first gas will be around $550 million.
Big news from Mexico
Worth noting, it’s not the Tolmount project that’s placed Premier Oil in the media spotlight this week. Namely, Premier, along with its partners Talos and Sierra, on Wednesday announced they’d made a world class, historic oil discovery of more than a billion barrels, offshore Mexico.
The discovery was made at the Zama-1 exploration well in Block 7, operated by Talos which holds a 35% participation interest, with Premier Oil and Sierra Oil & Gas as its partners with 25% and 40% participation interests, respectively.
The Zama-1 well, according to Talos, is the first offshore exploration well drilled by the private sector in Mexico’s history. The announcement sent Premier’s shares up some 30 percent to 63.75p on Wednesday.
Offshore Energy Today Staff