Premier Oil, a UK-based independent oil and gas company, has informed that the development of the Solan field in the UK North Sea, west of the Shetland Islands, is progressing well.
In its recent trading update, the company said that the construction and onshore commissioning of the jacket and the topsides were nearing completion.
The offshore installation and heavy lift campaign is scheduled to begin in August before hook up and final commissioning. Total project cost, including spend beyond first oil, is now estimated at $1.4 billion.
Premier will take an enhanced share of the project’s cash flow until it has received a pre‑agreed return on its investment. Premier is also in negotiations with Chrysaor over the sale or refinancing of the loan to Chrysaor and the funding of Chrysaor’s share of future capex requirements for the Solan project.
The Premier Oil-operated Solan field is expected to produce approximately 40 million barrels of oil with an estimated initial production rate of 24,000 barrels of oil per day starting in the fourth quarter of 2014.
The project will entail the drilling of four subsea wells (two producers and two water injectors) tied back to a processing deck supported by a jacket. It is planned that the facilities will not be permanently manned after one year of operations.
Oil will be stored in a subsea tank prior to being offloaded to shuttle tankers. The specially designed 300,000-barrel subsea storage tank sailed from Dubai in June from the Drydocks World yard.