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Serica flags slight dent to production on advice from Shell
29th Oct 2021 10:18
(Sharecast News) -
The AIM-traded firm said that to minimise environmental impact and associated processing equipment, Columbus hydrocarbons would flow into the Arran subsea system before processing on the Shell-operated Shearwater platform.
It said Shell had informed Serica that the Shearwater platform was currently operating at restricted capacity, which would result in a delay to the start-up of Columbus production, although it was still expected that first production would be achieved in the fourth quarter of the year.
As a result, Serica's full-year net production was expected to be "slightly lower" than the current guidance of 23,000 to 25,000 barrels of oil equivalent per day.
"There will be no significant long-term impact resulting from this short delay to the Columbus start-up, and I am pleased that the well is ready to produce as soon as the export system allows," said chief executive officer Mitch Flegg.
"The result of this delay is that it is now likely that our full year production will be slightly lower than our previous production guidance.
"Net Serica production has been strong during September and October, averaging over 26,000 barrels of oil equivalent per day from our BKR and Erskine fields during a period of strong commodity prices."
Flegg said the use of existing infrastructure to progress the development of Columbus reinforced the benefit of Serica's approach to providing "much-needed" low-carbon gas for the UK.
At 1023 BST, shares in Serica Energy were down 1.72% at 206.88p.
The AIM-traded firm said that to minimise environmental impact and associated processing equipment, Columbus hydrocarbons would flow into the Arran subsea system before processing on the Shell-operated Shearwater platform.
It said Shell had informed Serica that the Shearwater platform was currently operating at restricted capacity, which would result in a delay to the start-up of Columbus production, although it was still expected that first production would be achieved in the fourth quarter of the year.
As a result, Serica's full-year net production was expected to be "slightly lower" than the current guidance of 23,000 to 25,000 barrels of oil equivalent per day.
"There will be no significant long-term impact resulting from this short delay to the Columbus start-up, and I am pleased that the well is ready to produce as soon as the export system allows," said chief executive officer Mitch Flegg.
"The result of this delay is that it is now likely that our full year production will be slightly lower than our previous production guidance.
"Net Serica production has been strong during September and October, averaging over 26,000 barrels of oil equivalent per day from our BKR and Erskine fields during a period of strong commodity prices."
Flegg said the use of existing infrastructure to progress the development of Columbus reinforced the benefit of Serica's approach to providing "much-needed" low-carbon gas for the UK.
At 1023 BST, shares in Serica Energy were down 1.72% at 206.88p.