Premier in H1 output boost

More flows: Premier Oil boosts production in the first half

Premier Oil has set its sights on first-half revenues of around $880 million as production shot up 10% in the period.

The UK explorer expects, however, average output to fall in the second half as against the first six months, due to planned maintenance and asset sales.

The period from January to June is expected to return revenues of $880 million as compared with $758 million in the comparable period last year.

Net profit will, however, include an approximately $30 million after-tax charge for estimated future abandonment costs in the Balmoral area.

Expected full-year exploration costs are unchanged at $180 million, with $1 billion in development costs foreseen, also unchanged from previous guidance.

Average production in the first half hit 64,700 barrels of oil equivalent per day, ahead of budget and 10% up on a year earlier.

Full-year production guidance is between 58,000 and 63,000 boepd, however, due to planned summer maintenance and the impact of a series of recent asset sales. This output guidance is, however, unchanged from previous guidance.

The UK saw a 56% hike in average production to 21,200 boepd due to the inclusion of the Huntington and Rochelle fields. Current UK production is about 25,000 boepd, Premier said. The Balmoral and Wytch fields also performed well for the explorer in the period.

Shares in Premier were up more than 3% after 9:30am in London on Thursday.

“Preparations continue for the high impact 2015 exploration campaign,” Premier said. “This includes the Badada well, onshore Kenya, the Myrhauk well on the Mandal High in Norway and the four-well Falklands Islands campaign for which Premier has signed a rig contract and rig-sharing agreement.

“Subject to rig availability, Premier also plans to appraise the heavy oil play at Bagpuss/Blofeld in the UK North Sea in 2015.

“Seismic programmes are planned to start across Premier's blocks 717 and 665 in the Ceara basin in Brazil in the fourth quarter, while seismic acquisition across Block 90 in the Foz do Amazonas basin is under way.”

Last month Premier exited the Luno 2 discovery off Norway after selling its 30% stake to Lundin Petroleum for $17.5 million.

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