EDINBURGH (dpa-AFX) - Cairn Energy Plc (CNE.L) said that Over the last twelve months, it has achieved several strategic milestones and is well positioned to deliver on its strategy in 2018. Both the Kraken and Catcher developments in the UK North Sea have delivered first oil production. In Senegal, Cairn completed a successful third phase of drilling with the joint venture now targeting development approval for SNE field by the end of 2018.
Simon Thomson, Chief Executive, Cairn Energy PLC said, 'Cairn is funded in respect of all capital commitments with a strong balance sheet and growing production cash flows. We continue actively to assess and pursue new ventures within the context of a balanced exploration and production portfolio. We are excited by the potential of the recently awarded blocks offshore Mexico where we anticipate the start of exploration drilling in 2019.'
In the U.K., First oil from Kraken was achieved during the first-half of 2017. On the basis of current well performance and subject to continued progress on plant uptime, the Operator expects production to reach 50,000 bopd gross during the first-half of 2018. Full cycle gross Kraken project capex is forecast to be ~25% less than the original sanctioned project cost.
Full year production, net to Cairn, for 2018 is estimated to be 17,000 to 20,000 bopd with plateau production from Catcher and Kraken achieved by mid-year.
SNE field (Cairn 40% WI) appraisal and concept select definition are concluding for the first phase of development of the extensive resource base. The JV aims to have a Government- approved exploitation plan in place by the end of 2018 with a target of first oil in 2021-2023.
In Norway, the company noted that an extensive exploration drilling campaign is underway for 2018/19, with plans to drill up to ten wells, targeting greater than 1.5 boe gross unrisked resources across a variety of play types in the UK and Norway, including the Barents Sea.
Cairn secured two new licences in the Mexico offshore bid round in H1 2017. The licences, one operated and one non-operated, are located in the highly prolific yet under-explored Sureste basin. Cairn anticipates exploration drilling to commence in 2019 on both blocks.
Cairn said it is currently unable to access the value in its ~5% shareholding in Vedanta Limited, valued at about US$1.1 billion at 31 December 2017 or accrued dividend payments due of US$104 million.
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