Brasse on Fast-Track at Faroe
Wednesday 14 September 2016
Faroe Petroleum has its foot on the accelerator to fast-track development of its Brasse discovery off Norway and is on the lookout for a heavyweight partner to bring the project to fruition, with first oil targeted in 2019.
The London-listed operator is currently screening concepts that could entail a subsea tieback of the North Sea find to one of three nearby platforms - Wintershall-operated Brage, or Statoil’s Oseberg South or Oseberg - though it is also looking at possible use of an unmanned wellhead platform, according to chief executive Graham Stewart.
He said it would be desirable to make a final investment decision on the scheme to coincide with submission of a development plan to the authorities as early as next year once it has finalised a concept and that 2019 was a viable start-up date.
This timeline depends though on whether Faroe decides to carry out an appraisal of the find made earlier this summer that is estimated to hold between 43 million and 80 million barrels of oil equivalent, he added.
“Brasse represents a game-changer for our company,” he stated on the sidelines of the Pareto Oil & Offshore conference in Oslo on Wednesday.
“We are looking to make serious progress next year to bring the project forward and would be looking to secure a contract for early-stage development in 2017,” he said.
Faroe is wasting no time in maturing the project to fruition given current low contractor prices that could yield major cost-saving benefits, according to Stewart.
“Companies that will do well with projects are those that commit to investments now to lock in lower costs, as we do not know how long low contractor prices will last,” he said.
However, Stewart stated it does not intends to carry out its debut development off Norway single-handed “as we do not have a track record as a developer”.
“We would therefore be looking to bring onboard someone with that capability that may entail us selling down some of our equity, though still participating in the project. We are more focused on value creation than becoming a developer,” he said.
Stewart said execution of the project would benefit from having an operator with previoius development experience, pointing to the likes of Statoil and Wintershall that operate the nearby facilities.
Faroe presently operates production licence 470 that hosts the discovery with a 50% stake, with sole partner Point Resources on the remaining 50%.
Stewart said the development concept would be relatively simple to design as it has an uncomplicated reservoir but did not rule out the possibility of using an unmanned wellhead platform - dubbed ‘subsea on a stick’ - similar to that being used on Statoil’s Oseberg Vestflanken 2 project due to lower well intervention costs.
He said the company was looking to develop projects in a more cost-efficient manner than has previously been the case and is looking at further acquisitions off Norway in the wake its $70 million deal with Dong Energy earlier this summer as it aims to become a leading independent player.
“We want to grow further here and to be able to drive projects more efficiently through simplification, standardisation and doing things in a smarter way,” he said.
Faroe is meanwhile also participating in development of the Centrica-operated Oda (ex-Butch) discovery off Norway that will be tapped as a subsea tieback to BP’s Ula platform, with first oil targeted in 2019.