Lundin Announces Drilling of New Exploration Well in Barents Sea

Lundin Petroleum announced that drilling of exploration well 7220/11-1 in PL609 has commenced. The company is trying to send reassuring messages to investors and stakeholders, despite the poor results reported on Wednesday. 

In the six month to 30 June, production was 28.1 Mboepd, 20% lower than in the first semester of 2013. In the second quarter, the daily production equally decreased, in comparison to the same period of last year and also in comparison to the first quarter of 2014. Also financial results are equally negative, with the net debt increasing from 1,192 in December 2013 to 1,777 MUSD at the end of June.

The Swedish company is trying to staunch the consequences of decreasing production from mature fields. It bet on the Johan Sverdrup Phase 1 Project, and on the nine exploration licences warded in the Norwegian 2013 APA licensing round. These efforts should result in a surge of production in 2015. 

“Our forecast production will increase significantly in 2015 with production start-up from the Bøyla, Bertam and Edvard Grieg oil field developments. We retain our 2015 average production forecast of approximately 50,000 boepd and expect to exit 2015 in excess of 75,000 boepd when all these projects are onstream,” Ashley Heppenstall, President and CEO of Lundin, said in a statement released on Wednesday.

NEW EXPLORATION WELL

Also on Wednesday, the Stockholm-based company released a note about its new exploration well on the Alta prospect in the Barents Sea. 

‘The main objective of well 7220/11-1 is to prove the presence of hydrocarbons in sandstones of Triassic age in addition to carbonates of Permo-Carboniferous age. Lundin Petroleum estimates the Alta prospect to have the potential to contain unrisked, gross prospective resources of 261 million barrels of oil equivalent (MMboe),’ the company wrote.