Lundin CEO blames Shell, Bluewater for Brynhild delays
After facing months of delays with the start up of the oil flow from the Brynhild oil field in the Norwegian part of the North Sea, Lundin CEO has placed the blame on Shell and Bluewater.
The field which was originally scheduled to produce first oil back in the fourth quarter of 2013, is yet to do so. The Lundin-operated Brynhild is situated near the Norway-United Kingdom border, some 210 km from the Norwegian mainland.
The development of Brynhild a subsea tie-back to the Bluewater-owned Haewene Brim FPSO located at the Shell Pierce development in the United Kingdom sector of the North Sea, 38 km south of the field. According to Lundin, commissioning issues related to the FPSO have been the main reason for delays.
In its quarterly report issued today, Lundin has said that first oil from the field is now expected start flowing in September.
Ashley Heppenstall , Lundin CEO said: “We have faced frustrating delays with the Brynhild development project, offshore Norway.”
“The delay to Brynhild first production has been a direct result of the inability of Shell and Bluewater to complete the FPSO related work scope on schedule to ensure the vessel is ready to recommence Pierce production and accept Brynhild oil.
“We are close to first oil which is now forecast in late September but based upon historically low levels of productivity and continued work scope changes I have low confidence in the Shell/Bluewater schedule and realistically expect Brynhild first oil to slip into the fourth quarter.”
As for the quarterly results, Lundin Petroleum today reported a drop in its earnings before interest, taxes, depreciation, and amortization for the second quarter of 2014.
The company’s EBITDA was $171.5 million, compared to $243.1 in the same period of 2013. Lundin reported net loss $2.4 for the quarter, versus $1.2 net profit achieved in 2Q 2013.