9th May 2018 11:09
LONDON (Alliance News) - Shares in Serica Energy PLC fell on Wednesday as it said a blockage on its Erskine field has not been resolved by the site's operator.
Further, the company is evaluating the impact of US President Donald Trump's plan to reimpose sanctions on Iran on its Rhum field, given the Iranian Oil Co (UK) Ltd is a 50% partner.
Shares were down 6.1% on Wednesday at 75.72 pence each.
In January, Serica said a blockage had occurred on the Lomond to Everest pipeline in the UK North Sea, which it believes was caused by a deposit of wax.
The operator, Chrysaor Ltd, has been unable to solve the problem and thus it has decided to stop clearance work and instead focus on speeding up a pipeline bypass.
Chysaor, Serica said, has progressed plans for a 26 kilometre bypass and a route survey has been completed. It expects work approvals to come in July and with construction due to start in August, production should be back underway at Erskine in September.
Serica's Chief Executive Mitch Flegg said: "While we are disappointed that efforts by the Lomond field operator to clear wax from the Lomond condensate export line have not been successful we are pleased that plans to achieve a permanent solution for this recurring problem are progressing well.
"The operator is taking the opportunity to perform significant extra maintenance work during the planned 2018 Lomond shutdown. This should lead to improved performance later this year and in future years to the long-term benefit of the Erskine field."
Flegg added: "Although this is expected to extend the Erskine shut in to September, there was no certainty that the clearance work would have been successful but would have still incurred additional ongoing cost. We have the benefit of a strong balance sheet which enables us to fund our share of the pipeline bypass during this period without Erskine production revenues.
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