Whalsay Energy has launched a farm-out process as it looks to bring in an operator to help develop the Bentley heavy oil field in the UK northern North Sea.
Whalsay acquired Bentley’s former operator Xcite Energy for just $1 in 2017 after the UK minnow fell into liquidation when it hit financial problems and failed to push through a financial restructuring, which was rejected by bondholders.
Whalsay, led by North Sea veteran Paul Warwick, has retained Gneiss Energy as advisers to run the farm-out process.
Since acquiring its 100% interest in Bentley, Whalsay has been drawing up new plans for a phased conventional development of the Block 9/3b field centred on a 20-slot platform linked to floating storage and offloading vessel.
The cost to first oil is estimated at $729 million, according to a marketing teaser being distributed by Gneiss.
“Whalsay is offering the potential to become the majority partner and operator of the Bentley licence,” the document said.
“This would include the selection of the final development concept solution. Whalsay is flexible with respect to the terms and structure of a farm-in. Numerous additional opportunities exist beyond the initial development,” the document said.
Under Whalsay’s new plans, a proposed initial development phase would target 131 million barrels of oil in what the company is calling the “core area” of the field, with production expected to peak at up to 45,000 barrels per day.
The proposed facilities would comprise 17 producer wells — all containing electrical submersible pumps — and three produced water re-injection wells, as well as conventional topsides fluid-handling facilities to process the Bentley crude to export specification.
The teaser said the economics of the new development plan have been independently verified.
Former operator Xcite Energy had drawn up plans to use a mobile offshore production unit bridge-linked to a cylindrical FSO before it went into liquidation in 2016 following five extensions to its licence term.
Xcite was engaged in talks with its bondholders over a debt restructuring to enable it to move forward with the development but the bondholders ultimately rejected a debt-for-equity swap and an application was then filed to place Xcite into liquidation.
Cayman Islands-registered Whalsay Energy Holdings (WEHL) bought Xcite on 30 June 2017, just one day before the licence covering Bentley field — P1078 — was due to expire.
Despite attracting interest from a number of potential buyers, liquidators FTI Consulting settled on WEHL as the buyer as it was owned by the holders of $155 million of bonds in Xcite.
WEHL then changed the name of the company holding licence P1078 from Xcite to Whalsay Energy.
Whalsay has since been granted a four-year extension until 30 June 2021.
Xcite was planning to produce about 300 million barrels of oil from Bentley over 35 years.
The field contains proven and probable in-place resources of 912 million barrels of heavy 10 to 11-degree API oil.
Since its discovery by Amoco in 1977, Bentley has been appraised by eight wells, including a 68-day extended well test carried out by Xcite in 2012.
