UK North Sea: SERICA Awards BG International a FEED Work

Serica Energy PLC has reached an agreement with BG International Ltd., as operator of the Lomond field, and Dana Petroleum Ltd., as operator of the Arran field (formerly the Barbara and Phyllis fields), whereby BG will carry out front end engineering and design work (FEED) for a bridge-linked platform (BLP) that will connect with the Lomond platform and provide gas and condensate reception facilities for Columbus and Arran production.

The Columbus field, discovered in 2006 in Block 23/16f in the UK Central North Sea, has now been shown to extend into the adjacent Block 23/21. The licence holders of both blocks will share the costs of the Columbus portion of FEED for the BLP and, under a separate agreement, have agreed to share the costs of the Columbus subsea facilities and to submit a new Columbus Field Development Plan (“FDP”) to the UK Department of Energy and Climate Change

Serica has been appointed the Operator by the Columbus Owners (as defined below) to manage the development process to the point of project sanction on their behalf.

FEED is already underway and it is expected that all FEED work will be completed in the third quarter of 2010 concurrent with FDP preparation and submission. Terms for the use of Lomond as processing host and export point for the Columbus produced fluids have reached an advanced stage of negotiation. Project sanction is programmed for the end of 2010.

The Columbus Owners are:

In Block 23/16f: Serica Energy (UK) Limited (50%), Endeavour Energy UK Limited (25%) and EOG Resources United Kingdom Limited (25%).

In Block 23/21: BG International Limited (83.333%) and Hess Limited (16.667%).

Serica CEO Paul Ellis said:

“We are pleased to have reached this significant milestone in the Columbus project. There are many stakeholders in the project and I am encouraged to see the level of cooperation that has been achieved and am now confident that we can contribute to the development of the UK’s resource base and create value for all parties, with production from Columbus planned in early 2013.”

The technical information contained in the announcement has been reviewed and approved by Peter Sadler, Chief Operating Officer of Serica Energy plc. Peter Sadler is a qualified Petroleum Engineer (MSc Imperial College, London, 1982) and has been a member of the Society of Petroleum Engineers since 1981.

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Source:Sericaenergy, June 16, 2010: