Serica Energy PLC on Tuesday confirmed its lowered full-year production forecast, despite third-quarter production and revenue growth.
The North Sea-focused oil and gas firm confirmed that it expects its full-year production to be around 37,000 barrels of oil equivalent per day. This would be a 5.1% rise from the average 35,167 barrels of oil per day reported for 2023.
This follows a gas compression fault at its Triton unit at the end of October that saw all production suspended. The company had said it expected production ‘slightly below’ its earlier 41,000 to 46,000 boepd forecast.
Serica on Tuesday said there has been an extended outage at Triton following this initial suspension of production, due to availability issues with the gas export compression unit.
Repairs have been completed and the firm expects production to restart this week. However, it noted that operational vulnerability will persist until its ongoing maintenance works are completed in the first quarter of 2025.
Serica said production in the first nine months of 2024 grew 18% to 37,800 boepd from 31,500 last year, while its third-quarter production increased 46% to 26,000 boepd from 16,300 boepd.
It said its third-quarter production was also hit by scheduled maintenance at its Bruce, Keith and Rum assets in the North Sea.
Third-quarter revenue rose 2.9% to $139 million from $135 million.
The realised gas price during the third quarter was 77 pence per therm, down 6.3% from 82p per therm last year. However, as the current price is around 120p per therm, Serica expects fourth-quarter realisations to be ‘significantly higher’.
Serica expects 2024 operating costs to be around $330 million, which it said was in line with its initial forecast. It also left its full-year pretax capital expenditure guidance unchanged at around $260 million.
Chief Executive Officer Chris Cox said: ‘Our ability to unlock production from mature fields has been illustrated through the positive drilling campaign at Triton and well work on Bruce. With the successful results from the B-6 well on Bittern expected to be followed shortly by the Gannet GE-05 well, our key focus is now working to translate these results into more robust production performance than we have seen in recent months.
‘The Autumn Budget has provided much needed clarity over future investment allowances. The remainder of the Triton well campaign will continue to benefit from full tax relief, and the retention of allowances opens up opportunities in the wider portfolio. Our subsurface team are continuing to work up options for the untapped potential around the Bruce Hub.
‘Our portfolio is set to provide material cash generation going forward and we are confident of growing both organically and through acquisitions, delivering significant returns to shareholders.’
Serica is due to outline its guidance for 2025 in a trading update in late January.
Shares in Serica Energy were down 3.3% at 134.20 pence each in London on Tuesday afternoon.
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