LONDON (Reuters) – Premier Oil is set to raise stable peak production at its Catcher field in Britain’s North Sea by as much as 17 percent to 70,000 barrels of oil equivalent per day this year, after output reached that level this summer, it said on Thursday.
The news came as Premier <PMO.L> reported first-half profit after tax more than doubled to $98.4 million, helped by higher oil prices.
First output at the Catcher field marked a milestone for the company last December, leading it to forecast a 10 percent output hike for 2018, with the field’s sustainable peak production – or plateau production – pencilled in at 60,000 barrels of oil equivalent per day (boe/d).
This summer, the field – of which Premier owns half alongside Cairn <CNE.L>, MOL <MOLB.BU> and Dyas – has reached 70,000 boe/d, of which around 65,000 is oil and the rest gas.
“There is significant scope to increase the plateau rate towards that level,” Chief Executive Tony Durrant said.
Premier reiterated it expected group output to reach 80,000-85,000 boe/day this year.
(GRAPHIC: Premier Oil Production – https://reut.rs/2P0kQ06)
Core profit, or earnings before interest, tax, depreciation and amortisation (EBITDA), rose around a fifth to $388.9 million in the first half, the British energy company said.
Its shares rose as much as 3.6 percent to a two-week high of 125.9 pence in early trading.
“At current oil prices (EBITDA) is expected to increase significantly in the second half of this year,” it said.
Premier kept its target to reduce its debt pile of around $2.65 billion by $300 million-$400 million by the end of 2018.
Looking for growth, Premier on Monday approved its Tolmount gas project in the British North Sea, which is expected to produce around 500 billion cubic feet (bcf) of gas from late 2020.
Construction for the Tolmount platform is due to start in December, Premier said.
Premier’s other two big growth projects are progressing as drilling in Mexico’s closely-watched Zama basin is due to begin early in the fourth quarter.
As for its Sea Lion project off the Falkland Islands’ coast in the south Atlantic, Premier has lined up initial agreements on contracts and expects funding to be in place by the end of 2018 and government approvals from mid-2019, Durrant said.
(Reporting by Shadia Nasralla; Editing by Edmund Blair and Mark Potter)