Faroe's P1161 license Poor quality oil and small resource sizes are to blame for Faroe Petroleum opting to return its 50%-operated P1161 license in the West of Shetland area, the company announced on 2 November 2012.
Faroe CEO Graham Stewart said the P1161 license, home to the Freya and Fulla discoveries, does not meet the company's economic criteria for substantial development investments.
An exploration well on the Fulla prospect found oil-bearing reservoirs in the Clair and Whiting reservoir sands, in July 2011. The extensive modeling that followed in order to develop Fulla alongside Freya – originally discovered in 1980 – showed poor oil quality, smaller than expected resource size and limited access to infrastructure.
'No economically viable solution has been found to bring these discoveries to development at this time, and consequently the license will be relinquished,' Faroe said in an official statement.
Faroe is not finished with the region; the company recently acquired interest in East Foinaven field and drilling is underway in partner fields in N.Uist and Spaniards East. Faroe also won four licenses in the West of Shetlands area during the recent UK licensing round.
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