Jersey Oil & Gas, a UK-based company working to develop an oil and gas production hub at the Greater Buchan Area in the UK North Sea, said Thursday it was in talks to raise funds to progress work on the project.
The company said it was responding to media speculation regarding "the company potentially undertaking an equity fundraise."
"The company confirms that it is in discussions regarding a fundraising of between £10 to 15 million," JOG said, adding that there can be no certainty that any funds will be raised by the company.
JOG on March 3 announced the concept selection for the Greater Buchan Area project, with Phase 1 including a single integrated wellhead, production, utilities, and quarters (WPUQ) Platform located at the Buchan field.
The company at the time said it would launch a farm-out process ahead of the final investment decision expected in 2022.
It on Thursday said that the planned farm-out process has now been formally launched.
Also, regarding the potential fundraise, JOG said: "The net proceeds of such a potential fundraise would be utilized to maintain momentum for the next phase of workstreams on the project and augment the company's existing cash reserves during farm-out discussions."
As previously reported the GBA development concept is based on P50 Technically Recoverable Resource estimates of, in aggregate, 172 MMboe of light sweet crude and associated gas within the Core GBA, which includes the Buchan oil field and J2 and Verbier oil discoveries. The development is planned to be executed in three phases, Jersey Oil and Gas said.
Production from the reservoirs will be supported by injection of both produced water and seawater. The Phase 1 facility will be normally manned. The Buchan wells are planned to be drilled using a heavy-duty jack-up (HDJU) located over a 12 slot well bay.
The Phase 1 facilities will be designed to accommodate Phase 2 and Phase 3 of the development. CAPEX costs for Phase 1 are estimated to be approximately £1 billion.
Phase 2 will develop the J2 West, J2 East, and Verbier East discoveries via a subsea tie-back to the GBA platform. Phase 3 will develop the Verbier West discovery via connection to the Phase 2 subsea infrastructure. Field life is anticipated to be 31 years.
JOG is looking to produce first oil from the first phase in Q4 2025. The second phase startup would follow in 2027, and Phase 3 in 2028. The facilities will be powered from shore.
JOG has said that its power from shore solution for the GBA Development Project is still economically attractive, despite a 'Green Premium' compared to the conventional case utilizing gas turbines.
"The costs associated with the provision of a subsea cable and grid connection outweigh the cost reductions associated with the removal of gas turbines and associated utility systems, resulting in a CAPEX increase of approximately £80 million," JOG said earlier this month.