Chevron's Erskine field has restarted production after being shut-in since September last year while a major upgrade was carried out on BG Group's Lomond facility, which it exports production through.
Before the shut-down, the field was producing about a quarter of what is able to, according to new equity partner Serica Energy, which recently closed a deal to buy an 18% stake in the central North Sea Erskine field, covering blocks 23/26a (Area B) and 23/26b (Area B) from BP.
The deal gives Serica, a smaller independent, an additional 3.3 MMboe of producing, proven and probable reserves at a cost per barrel of about US$4. As part of the deal, BP has acquired a 5% stake in Serica's share capital. It could also help unlock the firm's Columbus discovery.
Fluids from Erskine are transported from the Erskine platform (a normally unmanned wellhead platform) to the BG-operated Lomond platform, where they are processed. Erskine gas is then delivered from Lomond via the CATS pipeline system to the terminal at Teeside, England. Condensate is separated at the Lomond platform and delivered via the Forties pipeline to Cruden Bay, Scotland.
As well as giving Serica Energy additional production, and making tax efficient use of its resources, the stake in Erskine could help the company finally unlock resources from its Columbus field. Serica had hoped it could tie the field into a new bridge linked platform BG Group had been planning for the Lomond field, to expand capacity. However, BG Group decided against the investment and Serica has been looking for alternative routes to market since.
Serica’s partners in the block are Endeavour Energy UK Ltd. (25%) and EOG Resources United Kingdom Ltd. (25%).
Tony Craven Walker, Chairman commented: “This is a valuable asset which can be used to offset tax liabilities, not only from Erskine but also from other UK producing fields whether acquired or, in the instance of Columbus, developed by the company.”
The partners in Erskine are now Chevron (50%), BG (32%) and Serica (18%).
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