Development of the Premier-operated Tolmount Main gas field located in the southern North Sea has been sanctioned by the joint venture partners

Partners in the Tolmount gas field are Premier (operator with 50%) and Dana Petroleum with the same percentage. The sanction was preceded by Premier's approval of the development as the operator in June. Announcing the sanction of the project, Premier said on Monday that the Tolmount Main gas field is expected to produce around 500 Bcf of gas (96 mmboe) with peak production up to 300 mmscfd (58 kboepd).

According to the company, the project provides for a platform with minimal facilities, exporting gas to land through a new gas pipeline. The concept was selected in February 2017.

Contracts

The EPCIC (Engineering, Procurement, Construction, Installation & Commissioning) contract for the platform was awarded to Rosetti Marino.

Centrica's Easington terminal was selected as the host facility and Saipem as the EPCI contractor for the pipeline.

Selection of the rig contractor for the four development wells is expected shortly, Premier said.

Premier's share of the capex required to develop this large gas field is estimated at $120 million, comprising project management and development drilling costs.

The infrastructure joint venture between Humber Gathering System Limited (a member of the CATS Management Limited group of companies) and Dana Petroleum will own and pay for the platform and pipeline capex, in addition to paying for upgrades to the onshore terminal. In return, Premier will pay a fee for transporting and processing the Tolmount gas through the infrastructure.

The Tolmount flagship project now moves into the execution phase, with work planned to begin later this year. The first gas is targeted for the 4th quarter of 2020.

Tony Durrant, CEO of Premier, commented: “The sanction of our high-return Tolmount project marks an important milestone for Premier and underpins our UK production profile in the medium term. Tolmount is one of the largest undeveloped gas discoveries in the southern North Sea and is, in oil equivalent terms, similar in size to our Catcher project.

“We have also secured an innovative financing structure for the project that minimizes our capital outlay while maintaining our exposure to the upside in the Greater Tolmount area.”

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