Premier Oil is looking to increase production from its flagship Catcher field in the North Sea after a better-than-expected performance since it came on stream at the end of last year.
The update came as the company said the contribution from Catcher and higher oil and gas prices helped profits more than double in the first half of the year.
In May, Catcher, which is located east of Aberdeen, reached production rates of 60,000 barrels a day, the level agreed with the provider of the floating production storage and offloading unit (FPSO) at the field which Premier has a 50 per cent stake in alongside partners including Edinburgh’s Cairn Energy.
Since then, rates of up to 70,000 barrels have been achieved and the company said preliminary discussions have now started with the FPSO provider BW Offshore to increase capacity to enable higher production rates than currently agreed.
Chief executive Tony Durrant said Premier sees the potential for “considerable upside from the Catcher area” as a result of better-than-expected initial production rates and the opportunity to extend production by exploiting other discoveries nearby.
It has identified several discoveries in the Catcher area that could be linked to its existing development. Durrant also said potential acquisition opportunities continue to be evaluated as it looks to increase its asset base.
The group saw profit after tax more than double to $98.4m (£76.3m) from $40.7m in the first half of 2017. The group’s net debt fell to $2.65 billion from $2.7bn at the end of last year.
Turnover rose to $625m from $546.1m despite overall production across the group during the first half falling to 76,200 barrels a day from 82,100 barrels after the disposal of a number of operations.
Earlier this week Premier and partner Dana announced the go-ahead for the development of the Tolmount Main gas field, one of the largest developments in the Southern North Sea.
Shares in Premier have more than doubled over the past year and David Barclay at Brewin Dolphin in Aberdeen said the oil price rally and the group’s refinancing efforts in 2017 have now put the business in a “much stronger position”.
“Premier Oil’s share price has also benefited from positive news about new prospects. There were confident signals that the Tolmount Gas field is progressing earlier this week, with construction due to start in December and first gas expected by 2020,” he said.