Suncor Energy UK Limited announced today it has signed a purchase agreement to formalise the purchase of a 30% participating interesting in the Rosebank project from OMV (U.K.) Limited.
Under the agreement, Suncor will now participate in the UK North Sea project, following an initial payment of US$50 million (£40.47 million) to OMV.
In the event the co-venturers approve the Rosebank project final investment decision (FID) and Suncor elects to participate, Suncor could pay additional consideration to OMV (U.K.) Limited of up to US$165 million (£133.56 million), subject to adjustments according to the terms of the agreement”, the company informed in a statement.
Suncor Energy Completes Acquisition West of Shetland
The Rosebank project is located approximately 80 miles northwest of the Shetland Islands and is considered to be one of the best and largest remaining undeveloped resources in the UK North Sea.
The project is expected to supplement Suncor Energy’s existing portfolio of UK assets, the company explained in a statement.
The field lies closer to the North Atlantic than the North Sea, on the edge of the UK Continental Shelf (UKCS).
The UK-based project is operated by Chevron
According to Chevron, this is considered as a uniquely challenging deep water environment to operate in, that is largely undeveloped, with a low level of infrastructure, “but is potentially one of the last, great resource areas for the UK”.
Suncor’s Joint Venture (JV) partners include the operator of the project, Chevron North Sea Limited (40%), Suncor (30%), OMV (U.K.) Limited (20%) and DONG E&P (U.K.) Limited (10%).
Schedule Uncertain at Rosebank
When operational, the project should include a floating production, storage and offloading (FPSO) vessel, production and water injection wells, subsea facilities and a gas export pipeline.
The multi-billion dollar project west of Shetland still has no scheduled date. The project was on track until 2013, when Chevron started rethinking its viability to reduce costs.
However, the Chevron’s award of a contract for the FPSO vessel turret indicates it will go ahead.
According to Hyundai Heavy Industries (HHI), in charge of the engineering, procurement, construction and integration of the FPSO turret system, the vessel should be complete by November 2016 and is due to be the deepest moored facility on the UKCS.
According to Suncor, the project is currently in the front-end engineering and design phase and has a design capacity of 100,000 barrels and 80 cubic feet per day of natural gas.