Hurricane Energy PLC Operational Update (6953Q)

TIDMHUR

RNS Number : 6953Q

Hurricane Energy PLC

14 September 2017

14 September 2017

Hurricane Energy plc

("Hurricane" or the "Company")

Operational Update

Hurricane Energy plc, the UK based oil and gas company focused on hydrocarbon resources in naturally fractured basement reservoirs, is pleased to provide an operational update on the Lancaster Early Production System ("EPS").

Highlights

   --    Lancaster EPS remains on schedule for first oil in 1H 2019 

-- Hurricane has taken the Final Investment Decision on the development of the Lancaster Early Production System

-- Agreements now effective with Bluewater Energy Services for upgrade, lease and operation of the 'Aoka Mizu' FPSO vessel

   --    'Aoka Mizu' now on tow to Dubai for upgrade work 
   --    Rig contract signed with Transocean to complete already drilled EPS production wells 
   --    Fabrication orders placed with TechnipFMC for SURF and SPS 
   --    Development and Production regulatory approval expected shortly 

Following completion of the equity placing and convertible bond offering announced in June 2017 (the "Fundraising"), Hurricane and its key contractors have proceeded with procurement, fabrication and contracting activities related to the EPS on the Lancaster field. The Company, now fully-funded to reach first oil, remains on track for first oil in 1H 2019.

FPSO Aoka Mizu contract awarded to Bluewater

On 14 August 2017, key contracts between Bluewater Energy Services and the Company outlining terms for the upgrade, lease and operation of the FPSO vessel, 'Aoka Mizu', and associated agreements, became effective in accordance with their terms. These agreements had previously been executed on 23 June 2017. The vessel left Gdansk on 27 July 2017 and is currently on tow to Dubai, where its upgrade is planned to be undertaken. It is expected to arrive by early October. The mooring buoy is also being fabricated in Dubai, where work has commenced.

Rig contract awarded to Transocean

The Company has entered into a contract with Transocean for the Paul B. Loyd Jr. semi-submersible drilling rig to complete the previously drilled Lancaster 205/21a-6 and 205/21a-7Z horizontal production wells, commencing 2Q 2018.

SURF and SPS contract awarded to TechnipFMC

TechnipFMC has commenced procurement and fabrication of the main subsea components of the development including subsea umbilical, risers and flowlines "SURF" and subsea production system "SPS". Subsea installation activities at Lancaster are scheduled for summer 2018, in advance of the planned arrival of the 'Aoka Mizu'.

A TechnipFMC vessel has recently completed a further seabed survey as part of the planning process for boulder clearance around the area planned for SURF installation.

The Company is making good progress with the regulatory authorities in relation to the approval of Company's Field Development Plan ("FDP") and associated consents and permits for the Lancaster EPS development. Approval is expected shortly, with no impact to overall project schedule anticipated.

Dr Robert Trice, Chief Executive, commented:

"I am delighted that all operational work streams are proceeding on track for delivery of the project within the target timeline of first oil in 1H 2019.

"Successful completion of the Fundraising allowed the Company to move ahead with the upgrade of the FPSO, fabrication of the buoy, and procurement of the subsea components for installation work to begin next summer. We greatly appreciate the contributions of our key contractors and partners, Bluewater Energy Services and TechnipFMC, in progressing the project at pace.

"The Lancaster EPS is not only an essential step in planning for the full field development of the Company's Rona Ridge assets, but also represents a substantial development in its own right, with planned production of 17,000 barrels of oil per day.

"We look forward to providing further updates as we move forward with engineering, procurement, installation and commissioning (EPIC) activities; and once regulatory approval is obtained."

Contacts:

 
                        Dr Robert Trice (Chief 
 Hurricane               Executive Officer)/ 
  Energy                 Alistair Stobie (Chief           +44 (0)1483 
  plc                    Financial Officer)                862 820 
                        Nominated Adviser and 
 Cenkos                  Joint Corporate Broker 
  Securities             Derrick Lee/Nick Tulloch/Beth    [phone] 
  plc                    McKiernan                         6939 
 Stifel 
  Nicolaus              Joint Corporate Broker 
  Europe                 Callum Stewart/Nicholas          [phone] 
  Limited                Rhodes/Ashton Clanfield           7600 
 Vigo Communications    Public Relations                  [phone] 
                         Patrick d'Ancona/Ben              9704 
                         Simons                            [e-mail] 
 

About Hurricane

Hurricane was established to discover, appraise and develop hydrocarbon resources associated with naturally fractured basement reservoirs.

Hurricane's acreage is concentrated on the Rona Ridge, West of Shetland. The Lancaster licence, the Company's most appraised asset, has combined 2P Reserves and 2C Resources of 523 million barrels. In addition, the Company has 205 million barrels of oil equivalent on its Whirlwind licence (under the Whirlwind oil case).

During the 2016-2017 drilling campaign the Company made two significant discoveries* at Halifax and Lincoln, indicating that the Greater Lancaster Area and the Greater Warwick Area have the potential to be two large accumulations.

*Discovery - This classification is consistent with SPE/AAPG/WPC and SPEE guidelines for Petroleum Resource Management - Determination of Discovery Status

Glossary / Definitions

 
 AAPG   American Association of Petroleum 
         Geologists 
 EPIC   Engineering, Procurement, Installation 
         and Commissioning 
 EPS    Early Production System 
 FPSO   Floating Production, Storage 
         and Offloading vessel 
 SPE    Society of Petroleum Engineers 
 SPEE   Society of Petroleum Evaluation 
         Engineers 
 SPS    Subsea Production System 
 SURF   Subsea Umbilicals, Risers and 
         Flowlines 
 WPC    World Petroleum Council 
 

Important notice

Readers of this announcement should note that timeliness relating to the Lancaster EPS Development are indicative only. Sustained production is dependent on, amongst other things, successful receipt of the Regulators' approval of the field development plan and associated consents and permits, manufacture and installation of the FPSO mooring buoy, SPS and SURF equipment, completion of the producer wells, completion of the modifications to the FPSO Aoka Mizu and its successful hook up and commissioning at the Lancaster field, together with reservoir performance.

This information is provided by RNS

The company news service from the London Stock Exchange

END

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September 14, 2017 02:01 ET (06:01 GMT)