By Samuel Indyk
Investing.com – Hurricane Energy (LON:HUR) shares were trading lower on Wednesday after the company provided an update on production guidance from its Lancaster field. The oil & gas company said average production for the year is expected to remain within the range of 8,500-10,500 barrels of oil per day.
The guidance is based on an FPSO production uptime assumption of 90% and production from the P6 well alone on artificial lift via ESP.
Guidance for production from the Lancaster field for the six-month period from 1st October 2021 to 31st March 2022 is 8,500-10,000 barrels of oil per day, slightly lower than the average for the full year 2021. This is due to the expected gradual production decline from the reservoir over time, partially offset by the higher FPSO uptime assumption.
“The Company has benefited from higher than expected oil prices and excellent performance to date of the FPSO,” said Hurricane Energy CEO Antony Maris. “As a result of the combined efforts of the Hurricane and Bluewater teams, we anticipate being towards the upper end of our production guidance for 2021 and this is also reflected in our guidance for the next six months to 31 March 2022.”
Based on current trends, management estimates that wellhead flowing pressure in the Lancaster reservoir may reach the bubble point by the end of Q1 2022.
The company said that while this has been factored into the guidance, there will remain a degree of uncertainty regarding the full impact of this, along with the risk that gas liberated from the reservoir could be produced which could result in production either being reduced or ceased altogether.
At 11:43BST, Hurricane Energy shares were trading lower by 20.4% at 3.7 pence per share.