Industry Trend Analysis - Commissioning Issues Threaten Start-Up Pipeline - NOV 2017
BMI View: We have made a minor adjustment to our UK production forecast following ongoing commissioning issues at EnQuest's Kraken heavy oil field development. Whilst we remain positive on UK oil output growth, t he potential delays to other project start-ups in the North Sea basin will remain the largest downside risk to the timescale of our production forecast over the near term.
The Kraken oil field development, having been brought online in June 2017, has faced several problems with the operation of the site's Floating Production, Storage & Offloading (FPSO) vessel, forcing EnQ uest the operator to reduce the expected field production figures for 2017. The company revised down guidance production to approximately 37,000b/d from a previous estimate of just over 50,000b/d. The delays to full production are expected to be temporary, with the company aiming to achieve peak output from H1 2018.
Whilst the production delays are still a relatively small adjustment to total UK production forecast figures, potential delays to other projects in the basin will remain the largest downside risk to our production forecast over the near term. The extensive project pipeline in the UK North Sea will ensure strong production growth out to 2019, with crude output reaching 1.2million b/d for the first time since 2010.
|New Field Start-Ups|
|UK Oil Production Forecast By Field, 000b/d|
|Source, BMI, JODI, Oil & Gas UK|