6th Feb 2014 12:22
LONDON (Alliance News) - Faroe Petroleum PLC Thursday said its total average production in 2013 failed to reach its forecast levels due to necessary repairs in its second half.
The oil and gas company, with operations in Norway, the Atlantic margin and the North Sea, said its total average economic production for the full year 2013 fell to 6,059 barrels of oil equivalent per day from 7,200 barrels in 2012.
In August, Faroe said that it expects average production in 2013 to be at the lower end of its 7,000 to 9,000 barrels of oil equivalent per day guidance.
The company said its second half 2013 production was noticeably down due to its Njord and Hyme fields in Norway being shut in for repairs during the period.
Faroe Petroleum said that work on the reinforcement project at Njord is expected to be completed and production resumed in summer 2014.
The company said that for the long-term development of the Greater Njord Area, the current base case of operator Statoil assumes that, after a period of production, the facility will be brought to a yard for the hull to be either repaired or replaced
As such, average full-year production is scheduled to down again in 2014, to a range of between 4,000 and 6,0000 barrels of oil equivalent per day from all fields.
However, Faroe outlined what it described as an "exciting" period of high impact drilling in 2014, after recently securing interests in ten new exploration licences.
The company also noted that it continues to seek value-enhancing production acquisitions, looking to take advantage of market conditions to build reserves and cash flow.
Faroe said its pretax exploration and appraisal capital expenditure for 2013 is expected to be roughly GBP73 million, and its 2014 pretax exploration and appraisal capital expenditure is estimated to be roughly GBP110 million.
The company said that it is maintaining its forward momentum in building a strong and high potential value portfolio, and noted that its portfolio position in Norway is by far the largest of any UK independent exploration and production company.
Faroe Petroleum shares were up 1.4% to 109.56 pence Thursday.
By Tom McIvor; [email protected]; @TomMcIvor1
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