Oil and gas producer Cairn Energy on March 27 reduced investment plans by about a fifth, following the fall of oil prices to less than $30 per barrel.
Cairn and its partners, including Woodside and FAR, were assessing “substantial initiatives to reduce and re-phase” investment in the $4.2 billion Sangomar oil development project in Senegal, Cairn said in a statement.
Sangomar is expected to produce about 100,000 barrels per day with first oil scheduled for 2023.
“Based on initiatives already identified, Cairn’s expectation is that net capital expenditure on Sangomar in 2020 will be below $330 million, reduced from the original forecast of $400 million,” Cairn said.
“A broader review of capital expenditure for 2020 and future years is ongoing with the joint venture,” the company added.
FAR said in January it had signed a binding agreement with Glencore to market the Australian company’s share of crude oil from Sangomar.
For its producing fields in the British North Sea, Cairn expects capex to fall to $45 million this year from a previous forecast of $65 million.
Cairn kept its production forecast from Britain at between 19,000 and 23,000 barrels per day, just over a third of which it hedged at $62 per barrel and with production costs at below $20 per barrel.
Recommended Reading
Prairie Operating Gets Output, Acreage Boost from Nickel Road M&A
2024-10-02 - Prairie Operating closed an acquisition of acreage and production in Weld County, Colorado, where the D-J Basin player is drilling its first Niobrara horizontals.
Ovintiv to Divest Permian Assets Amidst M&A Rumors
2024-10-02 - Ovintiv is marketing assets in the Permian Basin amidst rumors that the Denver-based E&P is looking to join in on the M&A frenzy.
Summit Midstream Acquires Tall Oak Midstream III in $450MM Deal
2024-10-02 - The acquisition of Tall Oak Midstream III balances Summit Midstream’s crude and natural gas commodity exposure in preparation for high natural gas demand in the coming years, Summit Midstream CEO Heath Deneke said.
Diamondback Subsidiary Viper Closes $900MM Midland Royalty Deal
2024-10-02 - Diamondback Energy’s Viper Energy closed the last of three acquisitions from Tumbleweed Royalty, owned by Double Eagle Energy’s founders, that together totaled about $1.1 billion.
New Revenue Stream Opens Up With Natural Gas Decarbonization
2024-10-02 - Could a lower carbon revenue stream, focused on hydrogen and solid carbon, open up for natural gas players?