Premier Oil said Wednesday its output has surged above its full year guidance after completing summer maintenance.
Production year-to-date has averaged 57.1 thousand barrels of oil equivalent per day, up from the company’s full year guidance of 55.5 thousand boepd before any from contribution from the Solan project in West of Shetland.
UK-based Premier said it has hedged 6 percent of its 2015 2H liquids production at $92 per barrel and 30 percent of its expected liquids production in 2016 at $68 per barrel.
“Premier will continue to seek to add to this position as market conditions allow. As a result of significant cost savings, Premier continues to expect full year opex of c. $16/boe,” the company said.
The company’s 2015 full year capital expenditure guidance is unchanged and it expects a “significant” reduction in year-on-year capex in 2016.
Premier anticipates first oil from Solan in the fourth quarter of 2015, as previously announced.
“Good offshore productivity and 97 percent uptime has been achieved with the Regalia flotel. A number of the critical path platform systems have been successfully commissioned, including the firewater deluge system and other safety related systems such as the gas detection system,” Premier said.
Completion of the commissioning of the subsea infrastructure is also “progressing well.”
The company’s number of planned commissioning activity hours for first oil at Solan has been cut down to 34,000 hours from the 56,000 hours estimate in its half yearly results published in August.
These hours are being liquidated at a rate of 600 to 800 hours per day, Premier added.
The company said it has significant liquidity on hand with $1.3 billion of cash and undrawn credit facilities.