Investment costs for the Culzean project are now forecasted to be around US$4 billion, a reduction of about $500 million on the estimate at project sanction, said Gretchen Watkins, CEO, Maersk Oil at the Maersk Group Capital Markets Day in Copenhagen.
A significant improvement of project capex has been achieved in close collaboration with partners, suppliers and the authorities. The present breakeven estimate for the project now stands at $33/boe (including cost since sanction).
“Achieving cost reduction of 11% during project maturation, we are showing our ability to deliver greater value for investors and stakeholders through effective project delivery and controls,” said Watkins.
Culzean, a high pressure, high temperature gas condensate development in the UK Central North Sea was approved by the Oil & Gas Authority in August 2015. Since then, Maersk Oil and co-venturers BP and JX Nippon have worked together and with suppliers to improve the project, supporting positive development in investment costs.
The improved forecast has been achieved through higher drilling efficiency, robust upfront design and project planning, supply chain deflation and supportive foreign exchange movements. Culzean remains on schedule to deliver first production in 2019.
Image: Culzean topsides/Maersk Oil
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