Neptune making strides with North Sea fields bought from Apache

Exploration and production firm Neptune Energy said today that it is pressing ahead with several UK North Sea projects.

Neptune will dish out a rig contract for the Seagull development in the central North Sea in the second half of 2019.

The company took a final investment decision on the 50 million barrel project in March.

The field will be tied back to BP’s ETAP central processing facility in the central North Sea.

An exploration well will be drilled on the Isabella prospect in the third quarter of this year.

Neptune bought 35% of Seagull and 50% of Isabella from Apache last year.

The company is one of the most active explorers in the UK North Sea.

It has a stake in the southern North Sea Darach field, operated by One-Dyas, where an exploration well is currently being drilled.

First-quarter UK production averaged 16,700 barrels per day, up 20% compared to the fourth quarter of 2018.

Neptune’s UK operated production comes from the Cygnus gas field, which benefitted from improved efficiency and “fewer third party restrictions” in Q1.

But output from Cygnus was constrained slightly by “compressor stability issues” on the third-party Trent platform.

Neptune is still trying to find a compromise with UK authorities on pipeline entry specifications to let the firm export more gas from Cygnus, which was acquired from French firm utility Engie in a near-£4 billion deal that closed in February 2018.

The firm has stakes in production fields in North Africa and Asia Pacific, as well as the North Sea.

Group production for the first three months of 2019 reached 151,800 barrels of oil equivalent per day (boepd).

Neptune expects to finish the year higher, with average output of 155 boepd, bolstered by contributions from Touat in Algeria and Fram in Norway.

First-quarter pre-tax profits totalled £163 million, while revenues came to £490m.

Neptune chief executive Jim House said: “We continued to make operational progress across the Group in the first quarter, while reducing costs.

“We also made good progress on project delivery, with all developments progressing on time and on budget.

“Our guidance for the full year remains unchanged, with the Touat gas project in Algeria scheduled to come online in June and hit plateau production early in the third quarter.

“This will add significantly to our production capacity, with higher production expected in the second half of the year.”

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Craigmill, Pitcaple, Inverurie, Aberdeenshire, United Kingdom, AB51 5HP
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