Reuters logo
REFILE-UPDATE 2-EnQuest oil production rises 20 pct Jan-April
May 15, 2015 / 6:57 AM / 3 years ago

REFILE-UPDATE 2-EnQuest oil production rises 20 pct Jan-April

(Refiles to clarify in paragraph 4 that company expects Alma/Galia to produce up to 6,500 bpd in second half)

By Ron Bousso

LONDON, May 15 (Reuters) - Oil producer EnQuest Plc said its output rose 20 percent in the first four months of 2015, topping 30,000 barrels per day for the first time thanks to strong performance at its Malaysian asset.

The company, which specialises in maximising oil output from old fields that aren’t profitable enough for big oil firms, said the start-up of its North Sea Alma/Galia project remained on track for mid-2015.

Enquest shares were trading 0.9 percent lower at 0900 GMT, while the European oil and gas sector was down 0.5 percent.

The company expects Alma/Galia to produce up to 6,500 bpd in the second half of the year, Chief Financial Officer Jonathan Swinney told Reuters.

Production on the Kraken field, one of the largest developments in the North Sea, was on schedule to start in 2017, the company said.

It expects its North Sea output to reach 50,000 bpd in the coming years.

EnQuest, which is mostly focused on the North Sea, acquired an interest in the PM8/Seligi oil field in Malaysia last June to grow outside of its core UK market.

Oil production in the North Sea has fallen to the lowest level since fields started pumping fossil fuels in the mid-1970s and fresh investments have stalled dramatically.

Enquest has cut operating costs by more than a quarter since the sharp decline in oil prices last July, Enquest Chief Executive Officer Amjad Bseisu told Reuters.

“We are passing the cost savings down the supply chain. We have been negotiating with drilling rigs contractors... we’ve reduced those by around a third,” Bseisu said.

Contractor rates were cut by around 25 percent, he said. The company also hedged 10 million barrels at $65 a barrel in 2015, Bseisu added.

EnQuest said production rose to 30,768 barrels of oil equivalent per day (boepd) for the four months to April from 25,597 barrels a year earlier.

“Operationally EnQuest continues to deliver and, as we have highlighted before, it is the most geared of any of the North Sea small-caps to the supply chain deflation we see playing out in the North Sea,” BMP Capital Markets analyst David Round said in a note, rating Enquest shares as “market perform”. (Additional reporting By Karolin Schaps in London and Mamidipudi Soumithri in Bengaluru; Editing by Gopakumar Warrier/Ruth Pitchford)

Our Standards:The Thomson Reuters Trust Principles.
0 : 0
  • narrow-browser-and-phone
  • medium-browser-and-portrait-tablet
  • landscape-tablet
  • medium-wide-browser
  • wide-browser-and-larger
  • medium-browser-and-landscape-tablet
  • medium-wide-browser-and-larger
  • above-phone
  • portrait-tablet-and-above
  • above-portrait-tablet
  • landscape-tablet-and-above
  • landscape-tablet-and-medium-wide-browser
  • portrait-tablet-and-below
  • landscape-tablet-and-below