UK oil and gas firm Hurricane Energy has announced it has spudded its first well at Warwick Deep, west of Shetland.

The 205/26b-C well was spudded using the Transocean Leader rig.

Warwick Deep is the first in a three-well programme on Hurricane’s Lincoln and Warwick assets – the Greater Warwick Area.

The company completed a farm-out deal last year involving the sale of 50% of its Greater Warwick Area to Spirit Energy, who will cover the cost of an initial three-well programme targeting up to 2 billion barrels.

The Lancaster field (100%) is Hurricane’s most appraised asset, with five wells drilled by the Company to date.

Partner Spirit Energy agreed to stump up £139m to cover the cost of the campaign, which targets 2 billion barrels of oil, as part of a deal that saw it acquire 50% of GWA.

London-listed Hurricane provided the update in its 2018 results announcement, which showed pre-tax losses of £46.6m, widening from a deficit of £5.3m in 2017.

Hurricane said the 2018 annual report would be its last with no revenue.

Hurricane chief executive Robert Trice said the Lancaster revenues would help the firm go after further appraisal and development activities in its portfolio.