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Alpha goes with Awilco at Cheviot

Oslo-listed rig owner handed multi-year deal for development wells at proposed UK North Sea project

Private equity-backed player Alpha Petroleum Resources has awarded Awilco Drilling a multi-year contract to drill development wells at its proposed Cheviot oilfield project in the UK North Sea.

The Oslo-listed driller has won the three-year letter of award to drill 18 development probes at the northern North Sea project, which is expected to be sanctioned in the fourth quarter.

The firm part of the deal is set to start in the second quarter, with Awilco saying it has a minimum contract value of $126 million. With the firm period set to last 1080 days, this translates to a dayrate of around $116,700.

Awilco did not make reference to any optional period or number of optional wells, but the proposed development plan for Cheviot is thought to call for 18 firm wells and an increase to 23 as the development progresses.

Alpha chooses BHGE for Cheviot development

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The rig owner did not specify which unit or units it will put on the job, but highlighted that its semi-submersible WilPhoenix is one of two "Enhanced Pacesetter" semisubs in its fleet, which can drill in water depths of up to 1200 feet (366 metres).

Cheviot is a redevelopment of the Emerald field, which was originally discovered in 1975 and was initially developed in the mid-1990s. It is located east of the Shetlands in part blocks 2/10b, 2/15a and 3/11b and containing reserves of 55 million barrels of oil and 20 million of oil equivalent of gas.

Alpha, backed by private equity company Petroleum Equity, operates the field with a 100% interest.

First oil is expected in 2019 at an expected rate of at least 30,000 barrels per day with the core development comprising 18 firm and five contingent wells.

Alpha herds Cheviot towards development

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Late last month Alpha chose Baker Hughes to provide integrated well construction services at Cheviot. The services player, which has fused with GE’s oil and gas business, said its workscope will initially cover 18 wells, with the potential to increase to 23 wells as the development progresses.

Baker Hughes said work is anticipated to take up to 20 months with a start date in the second quarter next year, subject to Alpha sanctioning the project.

In April, Alpha announced an exclusivity agreement with Teekay Offshore Partners to use its Varg floating production, storage and offloading unit on the project.

A month later, Alpha selected GE Oil & Gas as subsea engineering and equipment supplier for Cheviot.