Hurricane Energy’s (HUR.L) Lancaster field production slows after pump breaks

Hurricane Energy PLC on Thursday said that although its Lancaster field oil well produced a total of 353,000 barrels in May, issues with the well’s pump have slowed production considerably.

(Alliance News)

The Surrey, England-based oil and gas company has been drawing oil from a single well, P6, located in the Lancaster field in Scottish territorial waters. Extraction from the P6 well is assisted by an electric submersible pump.

Through May, the P6 well produced 353,000 barrels, with an average oil rate of 11,370 barrels per day. As of Friday last week, the well was producing 11,020 barrels of oil per day with a water cut of 31%.

Since that date production has dropped considerably. On Saturday, the P6 pump tripped, closing the well. The well is now on “natural flow” while issue is investigated and the company attempts to restart the pump.

Concerns regarding the pump at the P6 well were raised earlier this year. Pressure variability in March led to an investigation which found a possible obstruction limiting flow. In April the company noted that should the electric submersible pump in the P6 well fail it might not possible to restore it, and the well would have to be run at a permanently lower rate.

The company recently decided against renewing its charter for the Aoka Mizu floating production storage and offloading vessel in the Lancaster Field until 2025 due to poor production forecasts. Forecasts reported in April significantly downgraded the reserves and resources associated with the Lancaster field.

Hurricane’s well production data was issued in accordance with the reporting framework agreed in the company’s recent financial restructuring. Hurricane was unable to repay USD230 million of convertible bond debt maturing in July 2022 and initiated financial restructuring of this debt on April 30.

Hurricane Energy shares were trading down 4.2% at 1.15 pence each in London on Thursday afternoon.

By Scarlett Butler; [email protected]

Copyright 2021 Alliance News Limited. All Rights Reserved.

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