Page 16 - EurOil Week 37

EurOil PERFORMANCE EurOil

Serica reports weaker H1 numbers

on low prices and KBR shut-in

UK UK-FOCUSED Serica Energy has reported The company also benefited from having 50%
weaker pre-tax profits and an operating loss for of its first-half gas sales hedged.
Serica suffered the the first half of 2020, blaming the result on coro- Serica became the operator of the BKR
shutdown of its BKR navirus (COVID-19) disruptions, steep falls in fields in late 2018 after closing a series of deals
gas fields. prices and a shut-in at its Bruce, Keith and Rhum with BP, France’s Total, Australia’s BHP Bil-
(BKR) gas fields. liton and Japan’s Marubeni. It owns 98% and
The company booked GBP20.4mn 100% shares in Bruce and Keith, and a 50%
($26.1mn) in pre-tax income for the six-month interest in Rhum, where it is partnered with
period, down from GBP51.9mn a year earlier. Iranian Oil.
This was after it incurred a GBP33mn charge Serica has booked Awilco’s WilPhoenix rig
on fair value at the BKR assets to reflect their to undertake intervention work later this year at
45-year closure in late January. It had to a repair Rhum’s third production well, which has been
an underwater caisson at the Bruce platform that shut in since former operator BP experienced
handles gas from the fields. technical issues with its completion. The com-
Serica reported a gross loss of GBP19.8mn, pany also said it was targeting first gas from the
compared with a GBP52.4mn profit in the first Columbus field in late 2021 – six months later
half of 2019, and a GBP12.7mn operating loss, than initially scheduled.
versus a GBP52.5mn profit in the same period. The plan is to develop Columbus with a sin-
Average production was 21,600 barrels of gle well connected to a new pipeline between
oil equivalent per day net to Serica in the six the Arran field and the Royal Dutch Shell-op-
months, down from 30,000 boepd for the whole erated Shearwater platform. Work on this line
of last year. The decline was due not only to the fell behind schedule because of COVID-19
shut-in at the BKR fields but also maintenance restrictions.
work at the Erskine field. Serica secured a new licence in December
“I am pleased that we are able to report a last year near Rhum containing the North Eigg
mid-year profit before and after tax despite the and South Eigg prospects. It is preparing plans
challenging economic conditions encountered,” for an exploration well targeting a high-pres-
CEO Mitch Flegg commented. “Serica benefits sure, high-temperature reservoir. If a discovery
from an extremely low cost base and we have is made, Serica will seek to fast-track its develop-
managed to further reduce our absolute costs in ment, potentially using a subsea tie-back to the
2020.” Bruce facilities. ™

P16 www. NEWSBASE .com Week 37 17•September•2020