--Adds more detail and background—
North Sea heavy oil firm Xcite Energy (LON:XEL) received another endorsement from the oil industry today as specialist engineering group AMEC agreed to support the significant Bentley field development.
Already a member of the Bentley Alliance, formed in 2010 to exploit the potential of the heavy oil opportunity, AMEC has signed a memorandum of understanding (MOU) covering “future cooperation to support the development” of the field.
Xcite last year sold £13mln worth of crude to BP, another alliance member, who is assisting the company with marketing as well as some financing.
The project financing is also being supported, via reserve based loans, by a consortium of ‘high quality’ banks – including Royal Bank of Scotland, Societe Generale and General Electric’s finance arm.
This latest third party validation comes at an exciting juncture following last year’s successful production testing, which massively upgraded the field’s reserves, and ahead of the next phase of the project’s development.
The oil firm recently began talks to secure a long-term rig deal. And it is also pursuing a farm out process to bring in a development partner - a number of parties are believed to be interested.
Xcite and AMEC will shortly commence a front-end engineering and design programme.
The company also expects to draw up a wider services contract for the development during this time.
This will include project and programme management and controls, further detailed engineering and design, fabrication management, sub-contractor management, hook-up and commissioning, it added.
Xcite chief executive Rupert Cole said: "We are very pleased to have developed our existing relationship with AMEC to create the basis for these commercial arrangements.
“I believe that AMEC's expertise and track record in delivering major UK Continental Shelf offshore and heavy oil projects will complement the company's own skillset to deliver a best in class development programme.
“This is another industry confirmation of Bentley as one of the largest development-ready North Sea fields and provides further, complementary support to the current farm-out process as we progress towards development."