EnQuest reported its production from 1 January to 31 October 2014 averaged 27,567 Boepd, up c.19.2% on the same period last year. This reflects strong production from EnQuest's existing hubs and from the newly acquired assets in Malaysia and Tunisia, which produced 2,688 Boepd. EnQuest reiterates production guidance for 2014 of between 25,000 Boepd and 30,000 Boepd for the full year.
Development projects
* Alma/Galia. On course for first oil in mid-2015, following sailaway in spring 2015; construction work on the FPSO* is now substantially complete, with commissioning well underway. Five production wells are fully complete and are awaiting FPSO tie-in.
* Kraken. Progressing well and continues on budget and on schedule for first oil in 2017. EnQuest's drilling rig contract for the Transocean Leader has been executed, at a rate materially below the level this rig was previously contracted for.
*Floating Production, Storage and Offloading vessel
Financing
* As part of its regular programme to underpin planned capital investment in the year ahead, EnQuest has hedged c.22k Boepd in 2015.
* Whilst budgets are still being finalised, the indicative level of the UK capex programme in 2015 is in the approximate range of $700 million to $800 million, weighted towards the second half of the year. Additional limited amounts of international investment will be subject to approval and are expected to be cash flow neutral in 2015.
* EnQuest's investment programme is funded by its long term financing arrangements, with significant facilities in place, comprising the high yield bond, the retail bond and the $1.2 billion committed revolving credit facility, which is expandable to $1.7 billion.
Amjad Bseisu, Chief Executive, said, "The 19% growth in production to the end of October reflects continuing strong reservoir performance and top quartile production efficiency from our existing producing assets. It also reflects a substantial initial contribution from PM8/Seligi and Didon, our first producing oil fields outside the North Sea. The new interests EnQuest has acquired this year will add approximately 20MMboe to net 2P reserves.
The oil and gas industry has been adjusting its plans for the impact of recent decreases in oil prices and in associated service costs. We are currently planning our capex programme for 2015 and will set out the detail of our 2015 investment programme with our full year results.
With Alma due onstream in mid-2015 and Kraken on schedule for first oil in 2017, EnQuest is set for substantial production growth from its UK hubs. Growth is also enhanced by production from our new businesses in South East Asia and North Africa, increasing the diversity of EnQuest's portfolio."
