First Oil Achieved at Lancaster Field in U.K.

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Written by Martin Lynch, European News Editor for Industrial Info (Galway, Ireland)--Hurricane Energy PLC has announced that first oil has been achieved at its flagship Lancaster field, to the west of Shetland, in the U.K.

In an operational update in relation to the Early Production System development of the Lancaster field, the company confirmed that the Aoka Mizu floating production, storage and offloading (FPSO) vessel's startup phase completed a 72-hour production test with the combined flow from both wells reaching the planned production rate of 20,000 barrels per day (BBL/d) of oil.

Hurricane was established to explore hydrocarbons from naturally fractured basement reservoirs. Lancaster, which was first discovered in 2009, is the first such U.K. field to hit production.

"I am delighted to announce that First Oil has been achieved and that the Lancaster field is now on production, beginning the phased development of Hurricane's considerable resources on the Rona Ridge," said Dr. Robert Trice, chief executive of Hurricane. "Lancaster is the U.K.'s first producing fractured basement field and the fact that Hurricane has delivered this industry milestone on time and within budget is an incredible achievement. I would like to thank the staff of Hurricane, our Tier 1 contractors, and our shareholders for having the vision to make Lancaster happen. "We have successfully achieved our start-up data acquisition objectives and commenced the evaluation of this material. Up to 12 months of stable production will be required in order to provide a clear view of the reservoir and enable us to plan for associated full field development scenarios."

Industrial Info is tracking a number of active projects at Lancaster, including a $1 billion plan to replace the FPSO. The project will involve constructing a new FPSO or modifying a leased one with handling capacity of 75,000 BBL/d. Full Lancaster field development is expected to produce 45,000 to 50,000 BBL/d, which will leave spare capacity for a future tie back of adjacent Lincoln and Whirlwind discoveries.

Hurricane's other assets include Lincoln (50%), Warwick (50%), Halifax (100%), Whirlwind (100%) and Strathmore (100%). Together with Lancaster, these assets have total combined 2P reserves and 2C continent resources of 2.6 billion barrels of oil equivalent (boe).

Following first oil at Lancaster, Hurricane announced that it had sold its first cargo, which was lifted from the Aoka Mizu FPSO by the Amundsen Spirit shuttle tanker for BP Oil International Limited.

Trice said: "First lifting from the Lancaster EPS marks the generation of Hurricane's first revenue. We are now building the cash flow necessary to invest in the further appraisal and development of Hurricane's basement assets."

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