Fresh analysis of one of the UK North Sea’s largest undeveloped oil fields has reinforced the owner’s belief that the size of the west of Shetland asset is “substantial”.
Hurricane Energy said yesterday the latest data for Lancaster meant previous guidance saying the field contained more than 300million barrels was likely “conservative”.
Chief executive Robert Trice added: “The updated data from the Lancaster 7 and 7Z wells reinforce our belief that the Lancaster field is substantial.
“The Lancaster CPR (competent person’s report) due at the end of Q1 2017 will quantify the resources ahead of FID (a final investment decision) for the early production system (EPS) due at the end of H1 2017.”
Mr Trice said new data for Hurricane’s Lincoln and Warwick fractured basement assets, following the drilling of the Lancaster 7, 7Z and Lincoln wells in 2016, was also good news.
“We now await the results of the Halifax Well, which is designed to evaluate our exploration model which describes Lancaster and Halifax as a single hydrocarbon accumulation,” he added.
The company recently signed heads of terms with Netherlands-based Bluewater Energy Services for the use of the Aoka Mizu floating production storage and offloading vessel for the EPS phase of development.
Surrey-based Hurricane was founded by Mr Trice in 2005 to discover and develop oil from naturally fractured “basement” reservoirs in rock formed more than two billion years ago.
The firm now has a portfolio of wholly-owned exploration and appraisal projects, with 450million barrels of potentially recoverable oil, focused on fractured basement prospects west of Shetland.
In December, Hurricane said its estimate of the Lincoln prospect holding 250million barrels of oil was “conservative” after it successfully completed drilling and logging of the well.
Guernsey-based investor Crystal Amber has been building its stake in the company on the basis that Lancaster could be the tip of a large iceberg.
Unlike sandstone reservoirs that hold oil in the rock and have provided much of the world’s oil over decades, fractured basement rock – holding oil between cracks – is very hard and brittle.
Globally, fractured reservoirs are thought to contain about 20% of the remaining oil and gas resources.
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