UK-based oil and gas firm Jersey Oil & Gas has decided to let two North Sea licenses expire as they are not part of the company’s Greater Buchan area hub project.
The licenses in question are P2497 Block 20 / 4c (Zermatt) and P2499 Block 21 / 2a (Glenn), and JOG has decided not to advance to the next licensing phase, which would have required committing to a firm well in each of these. two license areas.
“Accordingly, the licenses will automatically cease and will be determined at the end of Phase A of its initial Term on August 29, 2021,” the company said.
Jersey Oil and Gas is working to develop the Greater Buchan Area (GBA) oil production hub in the UK North Sea and selected a development concept earlier this year. The selected concept envisages the development focused on a single integrated wellhead, normally manned, production platform, utilities and rooms, fed from the shore, which will be located in the Buchan field.
JOG said on Wednesday: “As announced on March 3, 2021 in our Buchan Area Development Project Concept Selection Update, the concept selected for GBA Development is slated to run in three phases and neither Glenn neither Zermatt was included in any of these phases.
“In Glenn’s case, this was due to the current sub-commercial status of the Glenn and Glenn North oil discoveries and, in the case of the Zermatt license, it was after taking into account the highest ranked and listed exploration portfolio. to drill. opportunities in the P2170 (Verbier) license. Since Glenn and Zermatt do not appear in our GBA development plans, this licensing determination does not affect our GBA assignment process, which is ongoing. “
The GBA development concept is based on P50 technically recoverable resource estimates of, together, 172 MMboe of light sweet crude and associated gas within the Core GBA, which includes the Buchan oil field and the J2 and Verbier oil discoveries. The development is planned to be executed in three phases, with CAPEX costs for Phase 1 estimated at approximately £ 1 billion. On March 11, the company formally launched a rights-transfer process for the GBA.
Andrew Benitz, Chief Executive Officer of Jersey Oil & Gas, commented on Wednesday: “JOG management has made the pragmatic and cost-effective decision not to go ahead with firm well commitments for Glenn and Zermatt nonessential licenses in the context of Capital allocation. JOG fully adheres to OGA’s asset management expectations governing the execution of exploration and evaluation work programs, and we continue to work closely with OGA as we advance our plans for the major development project GBA of the company “.
According to previous statements made by JOG, the company aims to produce the first oil of the first phase in the fourth quarter of 2025. The second phase of commissioning would follow in 2027 and phase 3 in 2028.