AIM-listed Serica Energy, a British independent upstream oil and gas company with operations in the UK North Sea, has announced its estimated oil and gas reserves at 31 December 2023 and an update on production during January and February 2024. The reserves estimates are extracted from an independent report prepared by RISC Advisory in accordance with the reserve definitions guidelines defined in the SPE Petroleum Resources Management System 2018.
Highlights (1)
- Net Proved plus Probable ("2P") reserves at 31 December 2023 of 140 million boe, up 10 million boe from 130 million boe at 31 December 2022 despite producing 14 million boe in 2023 on a proforma combined Serica and Tailwind basis
- Overall 2P reserves additions of 24 million boe during 2023 representing a reserves replacement ratio of 179% (2)
- Over 90% of 2P reserves in fields that are already in production
- Even split of oil and gas reserves
- Average net production in January and February 2024 about 45,500 boe per day
- Production guidance for 2024 remains at 41,000 to 48,000 boe per day
Mitch Flegg, Chief Executive of Serica, said:
'I am delighted that Serica has maintained its record of more than replacing reserves since 2018, with the company ending 2023 with higher reported reserves than from the combined Serica and Tailwind portfolios at the start of the year even after allowing for the oil and gas we produced in 2023. Nearly all the additions to reserves reported today are associated with fields that are already producing which limits incremental emissions. This record of delivery is a testament to the hard work of our staff and the underlying quality of the asset portfolio.
Production in the early part of 2024 has been encouraging and we look forward to the future impact of executing our investment programme this year. We are on track to commence the planned well intervention and drilling activities on the Bruce and Triton assets during the coming month.
It would be remiss not to express considerable disappointment with the extension of the EPL announced in the Budget yesterday. Current oil and gas prices do not represent windfall conditions for UK producers and increasing the tax burden on domestic oil and gas production again will be damaging for UK jobs and the economy. The achievements delivered by Serica have added to domestic sources of energy. The kind of approach exhibited in the Budget will lead to more imports and reduce the ability of our industry to enhance the UK's resilience to potential energy shocks in the future."
Oil and Gas Reserves
The 2P reserves net to Serica and movement during 2023 are summarised in the table below. The reserves at 31 December 2022 and 2023 production are pro-forma numbers, including the assets of Tailwind throughout the year.
(1) Reserves at 31 December 2022 and production during 2023 are based on pro-forma numbers including Tailwind assets as if owned throughout the year
(2) Revisions / 2023 Production
Revisions include the following items (increase unless stated):
- Bruce Hub
- Future investments in Bruce Hub facilities and wells including Bruce SCE infill well, Bruce and Keith well interventions and LP (5) compression project on the Bruce platform
- Updated Bruce and Rhum reserves reflecting better than previously projected performance of producing wells during 2023
- Reduction arising from deferral of Bruce field reservoir stimulation project following reprioritisation of opportunities
- Triton Area
- Gannet E reserves updated to reflect better than originally projected performance of GE0-04 well following first oil during 2023
- Progress towards Belinda development including the exercise of rig option
- Reduction in Bittern reserves due to remodelled production projections
- Columbus
- Increase to reflect better than expected production during 2023
2024 Production (6)
Average net production during January and February 2024 was about 45,500 boe per day.
Production guidance for 2024 remains at 41,000 to 48,000 boe per day.
(3) 2P Reserves at 31 December 2022 and 2023 are as per the CPR for year end 2023 and have been converted to barrels of oil equivalent using a factor of 5.8 bcf per mmboe. The actual calorific values of gas produced from individual fields vary. Consequently, production and revisions in the table above may not convert precisely.
(4) The total annual rate of production reported on 5 February 2024 was based on calorific values of gas produced from individual fields
(5) Conversion of gas production facilities to Low Pressure operations
(6) Based on calorific values of gas from individual fields
Source: Serica Energy
