Nexen Achieves First Oil From Buzzard Field
Nexen has announced that Buzzard field in the U.K. North Sea commenced production on January 7, 2007. "The Buzzard development is a key component of our North Sea growth strategy that will generate strong economic returns for our shareholders and firmly establish Nexen as a significant competitor in the North Sea," said Charlie Fischer, Nexen's President and CEO. "Buzzard is capable of supplying approximately 10% of the U.K.'s annual forecast oil demand at peak rates and has been eagerly anticipated within Nexen, by the market and by other stakeholders in the U.K."
Buzzard is located in 100 meters of water, approximately 100 kilometers northeast of Aberdeen, Scotland. With gross recoverable reserves of approximately 550 million boe, it is one of the largest oil fields to be discovered and developed in the U.K. North Sea in over a decade. Peak production of 200,000 boe/d (85,000 boe/d net to Nexen) is expected to be achieved during the first half of 2007. To date nine production and five injection wells have been drilled. Buzzard is planned to be developed with 27 production wells and 11 water injection wells. Oil production is shipped to market via the BP operated Forties pipeline system, while gas is exported via the Total operated Frigg gas pipeline system.
"As one of the largest North Sea discoveries in the last decade, the Buzzard field will significantly boost overall U.K. oil production," said Alistair Darling, Secretary of State for Trade and Industry. "The field begins production today and this is good news for the industry and our economy. We know there are still between 15 and 20 billion barrels remaining in the North Sea, and with Buzzard, the U.K. should return to being a net exporter over the next couple of years."
This has been a pan-European achievement with the Buzzard facilities designed by CB&I in London, the jacket structures constructed by Aker Verdal in Norway, the well head deck built by BIFAB in Scotland, the Utilities and Quarters deck built by Heerema Hartlepool in England, the Production Deck built by Dragados in Spain and the pipelines and facility installation completed by Saipem from Italy.
"Completing Buzzard on time and on budget, in just three years from approval of the development by the U.K. government, is a major accomplishment," said Fischer. "Our co-venturers, hundreds of suppliers and contractors, and thousands of people have worked on the project and I'd like to thank each of them for their commitment and hard work."
Nexen has a 43.2% operated working interest in Buzzard. Other co-venturers include Petro-Canada (TSX:PCA) (NYSE:PCZ) (29.9%), BG Group (NYSE:BRG) (LSE:BG) (21.7%) and Edinburgh Oil and Gas (5.2%).
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