Venture Production plc ("Venture"), the Aberdeen based UK independent oil and
gas production company today announces a further development in its strategic
alliance with Sevan Marine ASA ("Sevan").
Venture has awarded Sevan a contract for the provision of a second floating
production, storage and offloading unit to be deployed in its North Sea
operations, thereby exercising an option previously agreed between the two
companies. The hull and marine systems will be based on Sevan's patented Sevan
300 technology (formerly known as the SSP 300) and will be similar in design to
the first unit already contracted to start work for Venture.
The first phase of the new contract covers detailed engineering for production
facilities for the Pilot heavy oil field in Block 21/27a. At Venture's
discretion, to be exercised before December 31, 2007, this contract may then
extend into a life of field contract with a duration of five or ten years.
Extension of the contract will be dependent upon successful appraisal of the
Pilot field in 2007 and UK Government approval of the Pilot Field Development
Plan but the unit will not be confined to use exclusively on Pilot.
Venture plans to drill an appraisal well on the Pilot field during the first
half of 2007 and current development planning for Pilot envisages project
sanction during 2007 with first oil production in 2009.
The initial contract announced today also fixes the day rate for the new Sevan
300 unit and therefore secures the economic foundation for the development of
Pilot. It further underlines Venture's commitment to long term relationships and
innovative technology as the means to unlock the development of "stranded"
fields in the North Sea.
Commenting on the news, Mike Wagstaff, Chief Executive said:
"Our strategic alliance with Sevan, announced almost exactly a year ago, has
enabled us to secure access to a second floating production unit system from
Sevan, thereby making Pilot a very attractive potential development. Our first
Sevan 300 unit, which was previously called the SSP but has been renamed the
Sevan 'Hummingbird', is nearing completion of shipyard construction in China and
is anticipated to be deployed on the Chestnut field next year. Further out, we
already have plans for deployment of this unit elsewhere in Venture's portfolio
once it has finished producing from the Chestnut field. What we are announcing
today is access to a second Sevan unit to allow us to press ahead with
developing Pilot and other potential fields."
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