Hurricane Energy is cracking on with plans to extract oil from 4,000 feet beneath the seabed after its North Sea Lancaster asset was officially designated as an oilfield.
The Surrey-based company was founded in 2005 by chief executive Robert Trice to discover and develop oil from naturally fractured “basement” reservoirs in rock that was formed more than 2billion years ago.
It has just achieved official oilfield status for Lancaster, located west of Shetland, from the Oil and Gas Authority (OGA).
Hurricane carried out a successful flow test on its 207million-barrel Lancaster discovery last year, later announcing results it said would pave the way to commercial development.
Welcoming the OGA’s move to have the asset officially declared as an oilfield, the firm said it was an important first step in progressing the submission of a production system field development plan.
Mr Rice added: “The granting of oilfield status for Lancaster helps the partitioning of Hurricane’s other discoveries and prospects that sit within Licence P1368.”
Hurricane, which joined the Alternative Investment Market in February last year, has established a portfolio of wholly-owned exploration and appraisal projects focused on fractured basement prospects west of Shetland.
Bosses believe the potential scale of the recoverable resource within these reservoirs – estimated to contain at least 450million barrels of oil – presents the UK oil and gas industry with a “significant opportunity to access a material new strategic asset”.
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.
The west of Shetland area is already home to the Clair, Foinaven and Schiehallion producing oil fields, and contains an estimated 17% of the UK’s remaining hydrocarbon reserves.
Guernsey-based activist investor Crystal Amber has been building its stake in Hurricane on the basis that Lancaster could be just the tip of a very large iceberg.
Amber Crystal shareholder and investment adviser said recently that if things went according to plan, Hurricane would be worth many billions of pounds.
Recommended for you
