A £140 million investment is aiming to unlock new reserves at a North Sea oil field and extend its life by up to three years.
Spirit Energy and partner Dana Petroleum have announced plans to drill a new well at the Chestnut field, 200 kilometres north-east of Aberdeen, by the first quarter of 2020
Initial expectations when the field first came online more than a decade ago were for a little over two years’ production but it has since been successfully extended with a third well added in 2017.
The contract for Teekay’s Hummingbird Spirit Floating Production, Storage and Offloading (FPSO) vessel at the field has also been extended by up to three years to 2023 in a move which has secured 70 jobs.
Drilling on the fourth production well at Chestnut will kick off before the end of the year.
Chestnut was initially expected to produce seven million barrels of oil in just over two years, but additional investment from Spirit and Dana and consistently high production levels has since see it export more than 24 million barrels.
Neil McCulloch, Spirit’s executive vice-president for technical and operated assets, said: “Over time and with new technology we have understood more about the properties of the Chestnut reservoir. Rather than rest on our laurels, I am proud that we have gone further and secured the future for the offshore crews while extending the life of an important field for us.”
Spirit Energy, owned by Centrica and Germany’s Stadtwerke München Group, has interests across the UK, Norway, the Netherlands and Denmark, with 33 producing fields and nearly 150 exploration licenses.
It employs around 1,100 people in offices including Aberdeen and Staines-upon-Thames in the UK.
The business also owns and operates the Barrow Gas Terminals in the UK.
The announcement is the latest in a series of investment decisions for the North Sea in the past 12 months,
They include development of the Alligin field, 140 kilometres west of Shetland, by BP and Shell following the green light from the Oil and Gas Authority (OGA). The field is targeting 20 million barrels of oil equivalent.
The OGA has also given approval for the development of Zennor Petroleum’s Finlaggan gas field development.
Last year Shell said it was to develop its first new manned installation in the northern part of the North Sea for almost 30 years.
It is constructing a FPSO vessel for drilling in the Penguins oil and gas field which lies 150 miles north-east of the Shetland Islands. It was first discovered in 1974 before being developed in 2002.