Enquest said the drilling programme on the Kraken development project in the North Sea is ahead of schedule despite poor weather conditions, ensuring four production and four injection wells will be available for first oil.
The company revealed the progress as it gave its results from up to the end of last year.
EnQuest owns a 70.5% stake in the project alongside cairn Energy with a further 29.5%.
An additional $125million savings have been made in Kraken’s capex following a revision to its development plan.
EnQuest said a total of 23 wells are now expected to be drilled from three drill centres, instead of 25 wells from four drill centres.
The overall full cycle project costs have also been reduced by $425billion at sanction.
EnQuest chief executive Amjad Bseisu said:”EnQuest continues to focus on its strategic priorities in this low oil price environment: strengthening the balance sheet, delivering on production and execution targets and streamlining operations.
“Significant reductions in both capex and opex have been achieved, in conjunction with continued excellent operational performance, enabling us to produce positive operational cashflows at current oil prices.
“At the start of 2016, EnQuest had $496.0 million of cash and undrawn facilities, giving sufficient liquidity to fund Kraken through first oil at prevailing oil prices.
“In 2015, average production of 36,567 Boepd was up 31% year on year, above the 36,000 Boepd upper end of our guidance.
“This reflected high levels of operating efficiency and contributions from Alma/Galia and a full year contribution from Malaysia, which is now 25% of total production.
“Since EnQuest’s Operations Update in December 2015, we have taken further action on costs and are delivering additional savings, with unit operating costs now expected to be in the range of $25-27/bbl for 2016 and into the low $20s per barrel after Kraken is fully onstream.
“The Kraken full project capex had already been reduced by c.$300 million and EnQuest has since made a further c.$125 million reduction.
“The development itself continues to make strong progress, in particular the critical path conversion programme for the Kraken FPSO vessel is on schedule for its departure from Singapore for commissioning and hook up, with production in H1 2017.
“EnQuest’s high operating efficiency, great execution and low cost capabilities are essential for the challenges of the current market conditions.”
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