Maersk Oil cuts Culzean prices by $500 million in north sea
Maersk Oil has announced that the capital prices of its marquee Culzean HPHT gas project, within the uk Central north sea, are reduced by $500 million as a results of improved drilling efficiency and robust upfront style and project planning.
Investment prices for the Culzean project are currently forecast to be approximately $4 billion, a reduction of $500 million compared to the estimate at project sanction, ceo Gretchen Watkins said at the Maersk cluster capital markets day in copenhagen. a significant improvement of project capex has been achieved in close collaboration with partners, suppliers and the authorities. this break-even estimate for the project currently stands at $33/boe, including value since sanction.
“This updated forecast reflects Maersk Oil’s commitment to world category project execution and our aim to continually improve our major capital projects, together with our partners and suppliers. Achieving value reduction of 11 november throughout project maturation, we are showing our ability to deliver greater worth for investors and stakeholders through effective project delivery and controls,” said Watkins.
Culzean, a HPHT gas condensate development, was approved by the UK's Oil & Gas Authority in August 2015. Since then, Maersk Oil and co-venturers BP and JX nippon, have worked together effectively with suppliers to improve the project, supporting positive development in investment prices.
The improved forecast has been achieved through higher drilling efficiency, robust upfront style, project planning, provide chain deflation and supportive foreign exchange movements.
Watkins concluded, “Improvement is largely driven by pulling the levers within our management to enhance Culzean’s project economics. together with our position within the Statoil-operated Johan sverdrup field development, Maersk Oil is committed to delivering the next generation of significant north sea developments.”
Culzean remains on schedule to deliver 1st production in 2019.