Scottish oil explorer Cairn Energy today said it was about to embark on a “very busy exploration drilling programme” in the second half of 2019, targeting more than 800 million barrels of oil.
In an update ahead of its AGM in Edinburgh today, the company said it was drilling three wells in the UK and Norway, and three in Mexico.
Chief executive Simon Thomson said that in the last 12 months, the business has returned to being a “full cycle exploration and production company with production, home grown developments and exposure to material upside potential from an active programme of exploration drilling”.
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Last year was the first full year of production from its two production assets in the UK North Sea. Between them, Catcher and Kraken generated around 17,500 barrels of oil per day net to Cairn and around $395million in oil and gas sales revenue.
It also moved into new exploration areas including Suriname, Mauritania, Mexico and Ivory Coast.
It said group production for 2019 remains within guidance of 19,000-22,000 bopd for the first four months and an update on production performance will be provided later in the year.
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“We are particularly pleased with the performance of Catcher, which is operating ahead of our expectations and where operating efficiency is excellent. While we have reduced our reserve estimates for Kraken, we know what needs to be done to improve the performance of the field and we are working with the operator on several initiatives designed to increase the productivity of the assets on a sustainable basis.”
Cairn said the company is fully funded for all its planned drilling activity. It also said it continues to have a “high level of confidence in the merits of our case” as it awaits final determination from the arbitration process over a long-running Indian tax dispute.
