Premier announced that the development of its Tolmount Main gas field was sanctioned by the joint venture and infrastructure partners.
The Premier-operated Tolmount Main gas field, located in the Southern North Sea, is expected to produce around 500 Bcf of gas, 96 mmboe, with peak production of up to 300 mmscfd, 58 kboepd.
The project entails a minimal facilities platform exporting gas to shore via a new gas pipeline. The EPCIC, Engineering, Procurement, Construction, Installation and Commissioning, contract for the platform has been awarded to Rosetti Marino.
Centrica’s Easington terminal was selected as the host facility, and Saipem as the pipeline EPCI contractor. Selection of the rig contractor for the four development wells is expected soon.
Premier’s share of the capex required to develop this large gas field is estimated at US$120 million, comprising project management and development drilling costs.
The infrastructure joint venture between Humber Gathering System, a member of the CATS Management group of companies, and Dana Petroleum will own and pay for the platform and pipeline capex, as well as pay for upgrades to the onshore terminal.
In return, Premier will pay a tariff for the transportation and processing of Tolmount gas through the infrastructure. The Tolmount Main project now moves into the execution phase with construction works scheduled to start later this year. First Gas is targeted for Q4 2020.
Both Premier and Dana Petroleum are 50% partners in the Tolmount gas field.
“The sanction of our high return Tolmount project marks a major milestone for Premier and underpins our medium term UK production profile,” Tony Durrant, Premier CEO, said. “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.”
He also added that Premier has secured an innovative financing structure for the project which “minimizes our capital expenditure while maintaining our exposure to the upside in the Greater Tolmount Area.”