The operators of a North Sea oil project has confirmed it will launch behind schedule next year as it prepares to begin drilling on the site.
Sterling Resources confirmed the Cladhan development was now scheduled to begin production early next year, but insisted it remained satisfied with progress.
The project, with partners Taqa, is set to produce more than 17,000 barrels of oil equivalent per day once it starts up next year, with the field being tied back to Taqa’s nearby Tern Alpha platform.
“The Cladhan development is proceeding satisfactorily, slightly behind schedule but within budget, with first production expected around the end of the first quarter of 2015,” Sterling confirmed today.
“Development drilling is expected to recommence later in April.”
The news came as Sterling revealed full-year losses at the North Sea firm had narrowed, with the company posting a £18.6million loss for the year, compared to £29.6million in losses for 2012.
Increased revenues thanks to the Breagh gas field starting up, along with the company relinquishing its Sheryl licence in the North Sea, helped reduce the firm’s losses.
“The past year has been a transitional one as the company finally achieved production at Breagh and went through a significant change in leadership,” said Sterling chief executive Jake Ulrich.
“Our focus is now upon optimizing production levels at Breagh and reducing our working interest levels in the Black Sea, in order to advance development towards achieving Romanian production.”
The firm said it was looking to spend more than £51million this year, around half of which would be exploration costs in the UK North Sea and across Europe.
A further £2.4million has been set aside to cover predevelopment costs for the second phase of the Breagh gas field, with Sterling admitting it would likely need to invest in further offshore facilities, inclined a second platform.
The ongoing study on how best to develop the key North Sea gas field, which started production last year, will potentially mean the go-ahead on extending the field being delayed until next year, with production from phase two of Breagh set to slip to the third quarter of 2017.
“The size of the platform and well type and degree of stimulation are all key factors to a successful development of this area of the field during the second phase, all of which are currently being studied,” the company said.
The firm said it would look to begin drilling on the Niadar North Sea prospect later this year, and was looking for potential partners for the Ossian and Darach prospects it picked up in last December’s licensing round.
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