22nd Jan 2019 09:51
LONDON (Alliance News) - Cairn Energy PLC on Tuesday said it expects to see a rise in net production from the Catcher and Kraken North Sea oil fields in 2019, despite planned lower capital spending.
The oil & gas company said it estimates 2019 production from Catcher and Kraken to be in the range of 19,000 to 22,000 barrels of oil equivalent per day. For 2018, production from both fields averaged 17,500 barrels per day.
Revenue from the sales of oil and gas was USD395 million at an average price of USD68 per barrel of oil equivalent.
Capital expenditure for 2018 was USD335 million, in line with Cairn's guidance. For 2019, the company forecast capital expenditure to be around USD305 million.
For the Catcher field, Cairn is looking to gain approval for constructing subsea facilities for the near-field Catcher discoveries identified as potential subsea tie-backs. This is in order to maintain and extend plateau production at the field.
In Senegal, the SNE field development, in which Cairn has a 40% working interest, is on track with the final investment decision, set for mid-2019.
In Norway, the Nova field development in the Norwegian North sea is expected to deliver first oil from 2021, with peak production of 50,000 barrels of oil per day. Cairn holds a 20% stake in the project.
In terms of exploration, four wells are planned in the UK and Norway to be spud for the third quarter of 2019, and three wells are planned for spudding in the Gulf of Mexico in the third and fourth quarter of 2019.
Finally, in India, Cairn said it has completed all submissions and steps for the international arbitration under the UK-India Bilateral Investment Treaty.
The company is claiming compensation of USD1.4 billion, a sum it believes will return Cairn to its former financial position, if not for the actions of the Indian Income Tax Department since 2014.
"The SNE and Nova development projects are progressing on track, evaluation of the recent Agar discovery is ongoing, and we look forward to commencing a material exploration drilling programme in 2019 with up to seven wells offshore Mexico, the UK and Norway targeting a total gross volume in excess of one billion barrels," said Chief Executive Simon Thomson.
"We also expect a final international arbitration decision on our India claim in the near term, and we remain confident of our position," Thomson added.
Shares in Cairn Energy were up 1.8% at 188.50 pence on Tuesday.
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