Ithaca Energy announced it will slash its operating costs by a further $5 per barrel to $20 as a result of the start-up of the North Sea Stella field.
According to the company’s second quarter and first half financial results, the development is on track for first oil in November 2016.
“It has been particularly pleasing to announce the recent sail-away of the FPF-1, the quality and completeness of which means we move forward into the operational phase of the Stella development with confidence,” Ithaca Energy Chief Executive Officer, Les Thomas, said.
North Sea Stella Brings Cost per Barrel to $20
The FPF-1 modifications programme for the Greater Stella development has been completed in July and is now approaching the Stella field, with first oil expected three months after the sail-away, the company informed.
As well as this, Ithaca reported it will be able to secure long-term value for the Greater Stella Area hub due to a future move to oil pipeline exports and the expansion of its satellite portfolio.
FPF-1 departing the Remontowa Yard in August 2016
The company secured access to the Norpipe oil pipeline system for future production on the hub and completed the initial tie-in works.
This will enable Ithaca Energy to switch from tanker loading to pipeline export during 2017, reducing fixed operating costs, enhancing operational uptime and improving reserve recovery.
Ithaca Foresees Production Rise
“We remain focused on getting to first production safely and efficiently, whilst ensuring we secure the long-term value of the hub through our ongoing investment activities,” the CEO added.
“The business has continued to perform well over the first half of the year. Production is running ahead of guidance, operating costs have been further reduced and we have continued deleveraging the business,” he stated further.
The company foresees an increase in production to between 20,000 and 25,000 boepd, while unit operating costs should be reduced to less than $20 per boe with the start-up of production at Greater Stella.