London-listed operator EnQuest produced first oil from the Kraken, an East Shetland basin development in the UK North Sea on schedule and under budget.
EnQuest said Monday that first oil from the offshore project was delivered on 23 June, adding the 13 wells drilled and completed to date, comprising seven producers and six injectors, were being brought online in a phased manner to maximise long term productivity.
“EnQuest is delighted to confirm that first oil has been achieved on the Kraken development, delivered on schedule and under budget,” said Amjad Bseisu, chief executive of EnQuest. “Drill centres 1 and 2 are fully complete and work continues on drill centre 3; as a result, further production capacity will come online into 2018 as these further wells are put onstream.”
Bseisu said the Kraken is a transformational project; with its production, EnQuest is moving from a period of heavy capital investment, to a focus on cash generation and deleveraging the balance sheet.
A further update and additional analysis will be provided with EnQuest’s 2017 half year results, he said.
Kevin Swann, research manager, UK Upstream, at Wood Mackenzie said, "Kraken is the largest new field due to start in 2017 and we estimate production will average 20,000 b/d for the year. This would account for 15 per cent of year-on-year production growth in the UK in 2017.”
Production is expected to peak at almost 50,000 b/d in 2019, providing 4.5 per cent of overall UK liquids production that year, he added.
UK Oil & Gas Authority chief executive, Dr Andy Samuel said the Kraken is one of the most significant oil field projects in the UK Continental Shelf, and its successful production is positive news for the whole basin. “It has the potential to open up additional heavy oil opportunities in the Northern North Sea, with other developments in the pipeline,” he said.