Hurricane Energy Plc (LON:HUR) has announced the spudding of the Warwick West exploration well in the Greater Warwick portion of its Rona Ridge project.
The well, which kicked off earlier on Tuesday morning, is being drilled by the Transocean Leader rig and it marks the third and final well in the current work programme which is being paid for by farm-in partner Spirit Energy.
AIM-quoted Hurricane retains a 50% interest in the Greater Warwick Area, which neighbours the wholly-owned Greater Lancaster Area – host to the recently delivered early production system which has been flowing some 14,000 barrels of oil per day – following the 2018 farm-out to its Centrica-backed partner.
READ: Hurricane Energy boasts first revenues via Lancaster start-up
The Spirit Energy deal envisaged two phases of drilling with Hurricane being ‘carried’ for up to US$387mln of spending - US$180.6mln in the 2019 programme and a further US$187.5mln in a second programme next year.
Hurricane, in last week’s financial results statement, guided that long lead items have been ordered for the planned GWA 2020 well programme and a rig contract is expected to be signed shortly.
The 2018 agreement outlined that three additional wells could be drilled to further appraise the GWA assets and to assist engineering design ahead of a possible final investment decision on field development by 2021.
Chief executive Robert Trice, last week, said: "Following the successful Lincoln Crestal well, we look forward to continuing with our Greater Warwick Area work programme with our partners Spirit Energy.
“This programme is designed to enable us to obtain the necessary reservoir data from across the GWA in order to allow the partnership to work towards an initial phase of full field development on the Greater Warwick Area."
2019 well results so far
The Warwick Deep well – the first of the three - encountered a “poorly connected section of the fracture network” and it did not flow oil at commercial rates. The well did encounter a 712 metre section of fractured basement reservoir, with light oil confirmed in analysis.
Lincoln Crestal, the second and most recent well, was a success with flow testing results last week confirming rates of 9,800 bopd with pumping and 4,682 bopd in natural flow conditions. The crude was confirmed as being light, 43 degree API, oil.
Hurricane said it continues to analyse the possible reasons for the sub-commercial flow rates in the Warwick Deep well.
It is planned that Lincoln Crestal will be tied into Lancaster’s Aoka Mizu vessel, subject to regulatory consent and concurrent to the facility being tied into the West of Shetland Gas Pipeline system (WOSPs) and Lancaster’s ‘debottlenecking’.
Lancaster’s early production
Hydrocarbons were introduced into the EPS on 11 May ahead of ‘first oil’ production on 4 June.
Last week’s results confirmed production had averaged around 14,100 barrels of oil per day between 4 June and the latest crude lifting from the Aoka Mizu floating production facility, which was 17 September.
Four crude cargoes have been sold from the EPS to date, which in aggregate amounts to 1.6mln barrels of oil. The EPS has seen overall system availability above 85% which is the figure used in the company’s long-term guidance.
Hurricane’s current, unchanged, guidance for 2019 anticipates an average production rate of 12,500 bopd (per day since ‘first oil’) which equates to over 2.8mln barrels of crude.