GCIJersey Oil & Gas shares jump on acquisition of key vessel for Buchan field redevelopment
() , a North Sea-focused oil and gas producer, said it has agreed together with Buchan field partner NEO Energy to acquire the "Western Isles" floating production, storage and offloading (FPSO) vessel to be used as the processing facility for the planned redevelopment of the Buchan field.
The Western Isles is a high-quality FPSO vessel that has been operating in the North Sea since 2017. It is currently owned by Dana Petroleum (E&P) Limited (77%) as operator, and NEO Energy (23%). The vessel is scheduled to come off station around H2 2024.
"The operational capabilities of the vessel, along with its relatively limited service-life to date, make the FPSO an excellent fit for use on the planned redevelopment of the Buchan field." Jersey Oil & Gas said in a statement.
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Jersey Oil & Gas and NEO Energy, joint venture partners on the Buchan field in the North Sea, have finalised the terms to acquire the FPSO vessel Western Isles. The vessel is less than 8 years old and requires minor adaptation for the planned redevelopment of the Buchan field. Investors welcomed the news, sending shares 13% higher on Friday.
The move marks a significant milestone in the development of the project, as the vessel is key to completing the engineering work required to obtain FDP approval for the Buchan redevelopment next year. As a result of executing the FPSO acquisition agreement, Jersey Oil & Gas is due to receive a US$9.4m cash payment from NEO Energy, pursuant to the terms of the farm-out transaction announced earlier in the year.
Jersey Oil & Gas also said work was "progressing well" on the FEED studies required ahead of FDP approval in 2024 and the development moving into the execution phase. The 1st phase of the planned work programme involves redevelopment of the field, with the start-up of production targeted for late 2026.
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