North Sea operator Premier Oil confirmed its Catcher find was on course for “first oil” in 2016 after concerns emerged that further work on the field was delayed due to rising North Sea costs.
Premier chief executive Simon Lockett admitted 2013 had been a “challenging” year for the explorer as a tight North Sea service sector saw development work that would usually take weeks extend to months.
Premier’s shares fell 6.5% to 288.10p after the firm said North Sea production was set to be similar, or just slightly higher than last year.
Its forecast for 2014 output yesterday was lower than the 65,000 to 70,000 boepd it had targeted for 2013.
Over the course of last year, it twice cut its forecast, eventually landing at a range of between 57,000 and 59,000 barrels, due to issues at projects in the North Sea and Vietnam.
Its forecast this year was “conservative” due to the company’s expectation of further North Sea delays, a spokesman said.
He added: “Any issue right now in the North Sea that used to take weeks now takes months because the service sector isn’t so much there as it was.”
But he said Premier remained committed to the North Sea and particularly Catcher, which is 110 miles east of Aberdeen and is estimated to hold around 80million barrels.
“Catcher is a big discovery. They can comfortably justify development. It’s on track for first oil in 2016,” the spokesman said.
Premier is also closing in on a development decision for the Bream field.
The company struck a deal last year to take BG Group’s stake in the 50million barrel discovery, and now expects to make a decision on a concept to develop the prospect in the next few weeks before final investment is approved later this year.
The company, which expects to post total revenues of around £917million for the full year, said it was targeting 13 drilling projects for 2014, aimed at opening up more than 160million barrels of oil equivalent across prospects in Pakistan, Mauritania, Indonesia and Kenya.
Premier chief executive Simon Lockett said: “2013 was a challenging year for Premier and the wider industry as a whole.
“It is however pleasing that production reached record levels towards the end of the year, that four new projects will achieve first oil and gas in 2014 and that our mid to longer-term projects have taken significant steps forward.”
Production from Premier’s UK North Sea fields increased to an average of 14,900 barrels equivalent per day for the year, up from 12,000 in 2012.