Premier Oil has made final investment decision for the development of the Tolmount Main field in the UK North Sea.
Image: An offshore drilling platform. Photo: courtesy of QR9iudjz0/Freeimages.com.
The firm, along with its joint venture and infrastructure partners, will now move ahead with the development of the Tolmount Main gas field, which is expected to produce around 500 billion cubic feet (Bcf) of gas.
The Premier-operated Tolmount Main gas field development project is expected to have peak production capacity of up to 300 million standard cubic feet per day (mmscfd). It involves instruction of minimal facilities platform which will export gas to shore via a new gas pipeline.
Rosetti Marino has been awarded the engineering, procurement, construction, installation & commissioning (EPCIC) contract for the platform, while Centrica’s Easington terminal has been selected as the host facility.
Additionally, Saipem has been selected as the pipeline EPCI contractor.
Premier Oil plans to commence construction works at the Tolmount Main project later this year while the first gas from the field is scheduled for the fourth quarter of 2020.
Premier Oil CEO Tony Durrant said: “The sanction of our high return Tolmount project marks a major milestone for Premier and underpins our medium term UK production profile.
“Tolmount is one of the largest undeveloped gas discoveries in the Southern North Sea and is, in barrel of oil equivalent terms, similar in size to our Catcher project.
“We have also secured an innovative financing structure for the project which minimises our capital expenditure whilst maintaining our exposure to the upside in the Greater Tolmount Area.”
Premier operates the Tolmount gas field with 50% stake while Dana Petroleum owns the remaining 50% interest.
Premier’s share of the capital expenditure for the project will be $120m and covers project management and development drilling costs.
Additionally, an infrastructure joint venture between CATS Management and Dana Petroleum will own and pay for the platform and pipeline, and pay for upgrades to the onshore terminal.
Premier, in return, will pay a tariff for the transportation and processing of Tolmount gas.