Serica suffers setbacks at UK Columbus field
Serica Energy expects a £3mn ($4.3mn) cost overrun at the Columbus gas project in the North Sea after encountering difficulties at its development well, the London-listed company said on May 25.
The well was spudded in mid-March and drilled to a depth of 17,600 ft as planned, Serica said. In line with pre-drill expectations, a 5,900-ft horizontal section was drilled through the reservoir formations of the upper Forties and encountered a sequence of sands and shales.
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"The well requires sand screens to be installed to prevent fine particles being produced; difficulties were encountered while running the screens and it was ultimately not possible to install them," Serica said. "As a result, the reservoir section of the well will be side-tracked and re-drilled, using data collected during initial drilling to optimise its trajectory and avoid the difficulties encountered running the screens in the original well."
Serica expects the additional work to take three or four weeks at a net cost of £3mn. But "these operations are not expected to affect the timing of production start-up which is still expected during Q4 2021," the company said. CEO Mitch Flegg added that the project's economic returns "remain very attractive."
Columbus is expected to produce at a plateau rate of 7,000 barrels of oil equivalent/day, of which 70% will be gas. Serica operates the field with a 50% interest, while Waldorf Production has 25% and Tailwind 25%.
Serica also provided an update on the Rhum gas field, where it is preparing to launch a well drilled by former operator BP in 2005 but never put into production. The well has now been cleared of all equipment installed when it was completed, and reservoir access has been regained, allowing new completion equipment to be run in preparation for production, the company said.
A flow test is scheduled for June, and a diving support vessel has been contracted to install subsea control equipment, Serica said, in order to bring the well into production in the third quarter. Serica began its intervention work at Rhum in October last year.