Aker Energy is facing a delay to its proposed Pecan project off Ghana after its most recent plan of development and operations (PDO) proved unworkable, largely due to its incompatibility with the country’s regulatory framework.

The Norwegian player has changed strategy at the field, where its plan was to develop the Greater Pecan area, including the current discovery and future potential tie-ins on its operated Deepwater Tano-Cape Three Points (DWT-CTP) block.

Parent company Aker revealed late last week that the operator had “underestimated…the complexity of such a holistic approach to the entire DWT-CTP block”, leaving it to go back to the drawing board for a new PDO.

“The strategic direction impacted issues like regulatory framework, technical concepts prepared for increased recovery, and execution models based on alliance contracts with global suppliers,” said Aker chief executive Oyvind Eriksen.

One issue was the number of contracts for the proposed development that would need to be approved individually by Ghana’s Petroleum Commission, which “could exceed 2000”.

Aker Energy proposed regulatory amendments and, while it can see some being implemented, not enough will transpire to make its PDO workable, Aker said.

Instead, the company will now work to optimise and de-risk the development of the already contingent resources of between 450 million and 550 million barrels in the Pecan reservoir as well as tie-ins “within the applicable regulatory framework and agreements”, Eriksen added.

“Aker Energy will explore opportunities to simplify the technical concept and reduce the amount of investment in order to protect the robustness of the project,” the parent company said.

Eriksen admitted that the change in strategy “is likely to trigger delays”.

Until recently, Aker Energy was still targeting sanction at Greater Pecan this year. However, as Upstream has previously reported, there were suggestions in the market that it would be delayed until next year, which could push out first oil from 2022 to 2023.

The next milestone for the company is to get a new PDO for Pecan approved under the Petroleum Agreement and regulations from 2006, “and ultimately make a final investment decision”.

“Aker Energy will, in parallel, explore M&A opportunities that may grow and diversify the portfolio beyond the organic approach we have pursued to date,” Eriksen added.

Under the PDO that was submitted, Aker Energy was targeting the use of a spread-moored floating production, storage and offloading unit that was being designed to handle 110,000 barrels per day of oil, 110 million cubic feet per day of gas and 200,000 bpd of produced water with a storage capacity up to 1.6 million barrels.

Gas was to be re-injected until it could be exported, while produced water would be cleaned up before being disposed of in the sea, while seawater would have been injected to maintain reservoir pressure.

Pecan lies in the DWT-CTP blocks, in which Aker Energy holds a 50% operating stake alongside Russia’s Lukoil on 38%, Fueltrade 2% and GNPC 10%.

A total of seven discoveries have been made in DWT-CTP, including Paradise, Hickory North, Beech, Almond, Cob, Pecan North and Pecan, of which Pecan is the largest.

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It's back to the drawing board for Aker at Pecan