Premier Sanctions UK Tolmount Development
UK independent Premier Oil announced August 20 that its Tolmount Main gas field development has been green-lighted. The southern North Sea field is expected to produce around 500bn ft3 gas (96mn barrels of oil equivalent) with peak production of up to 300 mn ft3/d (58,000 boe/d) gross.
The project entails a minimal facilities platform exporting gas to shore via a new gas pipeline. Italy's Rosetti Marino is the engineering, procurement, construction, installation & commissioning (EPCIC) contractor. Centrica’s Easington terminal has been selected as the host facility and Saipem as the pipeline EPCI contractor. Selection of the rig contractor for the four development wells is expected imminently.
Premier’s share of the capex required to develop this large gas field is estimated at $120mn, comprising project management and development drilling costs. It and Dana Petroleum, a South Korean state KNOC subsidiary, each have a 50% equity stake in the field, so it it is assumed total cost will be $240mn.
The infrastructure joint venture between Humber Gathering System Limited (a member of the CATS Management Limited group of companies) and Dana Petroleum will own and pay for the platform and pipeline as well as pay for upgrades to the onshore terminal. In return, Premier will pay a tariff for the transportation and processing of Tolmount gas through the infrastructure.
The Tolmount Main project now moves into the execution phase with construction scheduled to start later this year. First gas is targeted for Q4 2020.
"Tolmount is one of the largest undeveloped gas discoveries in the southern North Sea and is, in barrel of oil equivalent terms, similar in size to our Catcher project. We have also secured an innovative financing structure for the project which minimises our capital expenditure whilst maintaining our exposure to the upside in the Greater Tolmount Area,” said Premier CEO Tony Durrant.