Serica Energy announces spudding of North Eigg well

11th Jul 2022 14:03

(Sharecast News) - North Sea-focussed upstream oil and gas company Serica Energy announced the spudding of the North Eigg exploration well on Monday.

The AIM-traded firm said well 3/24c-NE1 was spudded this morning by the Transocean Paul B. Loyd Jr. harsh environment semi-submersible drilling rig.

Serica is the operator and 100% interest owner in the high pressure, high temperature (HPHT) exploration well targeting Upper Jurassic turbidite sands, similar to those encountered in the nearby Serica-operated Rhum field.

If successful, it was anticipated that the reservoir would be gas-filled, and would be capable of providing low emissions gas to the UK domestic market during the "key energy transition years" of 2025 to 2035.

It was expected that a discovery at North Eigg would be developed using Serica's nearby 98% owned-and-operated infrastructure on the Bruce platform.

Results of the North Eigg well were expected in mid-October.

"This is an exciting exploration prospect located very close to Serica owned and operated infrastructure," said chief executive Mitch Flegg.

"In a success case, this means that any development could utilise the existing production facilities on the Bruce platform, thereby reducing the need for extensive investment in new facilities and reducing the carbon footprint of the development and subsequent production period.

"Our internal estimates indicate that the field could contain unrisked prospective resources - P50 recoverable - of 60 million barrels of oil equivalent."

Flegg noted it was a 100% Serica project, and so the benefits to the company could be significant.

"Not only are the prospective resources valuable but we anticipate that the development could add significant life to the existing Bruce facilities."

At 1354 BST, shares in Serica Energy were up 2.96% at 308.87p.

Reporting by Josh White at Sharecast.com.