Independent Oil & Gas PLC Award of Phase 1 SURF Contract to Subsea 7 (1946M)
May 07 2020 - 1:00AM
UK Regulatory
TIDMIOG
RNS Number : 1946M
Independent Oil & Gas PLC
07 May 2020
7 May 2020
Independent Oil and Gas plc
Award of Phase 1 SURF Contract to Subsea 7
Independent Oil and Gas plc ("IOG" or "the Company"), (AIM:
IOG.L), the development and production company focused on becoming
a substantial UK gas producer , as operator of its joint venture
with CalEnergy Resources (UK) Ltd, is pleased to announce that it
has awarded a sizeable Engineering, Procurement, Construction and
Installation (EPCI) contract to Subsea 7 S.A.. The contract will
cover the Subsea, Umbilicals, Risers and Flowlines (SURF) work on
Phase 1 of its Core Project in the UK Southern North Sea (SNS) and
is almost entirely lump-sum in nature. Confirmation of this award
follows a competitive tendering process and the recent approval of
the Phase 1 Field Development Plan (FDP) by the UK Oil and Gas
Authority (OGA).
Phase 1 comprises the development and production of the
Southwark, Blythe and Elgood fields through a total of five wells
with gas transported onshore via the Thames Pipeline. The SURF
contract incorporates project management, engineering, procurement,
construction and installation activities for the subsea elements of
Phase 1. These include a 6km 24-inch extension to the Thames
Pipeline to the Southwark platform, a 25km 12-inch line connecting
the Blythe platform to the Thames Pipeline, and a 9km 6-inch
pipeline and an umbilical connecting the Elgood field to the Blythe
platform, and associated subsea structures and tie-ins. A Phase 1
subsea development schematic can be viewed on IOG's website at
www.iog.co.uk/assets/ core-project-phase-1/ .
Extensive progress has already been made with Subsea 7 prior to
final contract award under a letter of limited commitment to ensure
that all workstreams have commenced and continued on schedule since
FID in October 2019 in anticipation of the FDP approval. As
recently announced, the 24-inch (Southwark) and 12-inch (Blythe)
line pipe have been manufactured and transported to the UK ahead of
planned installation scheduled in 2H 2020, and Subsea 7 is
progressing detailed engineering work in support of this
campaign.
Andrew Hockey, CEO of IOG, commented:
"We are pleased to be working with Subsea 7, a globally
recognised leader in offshore energy services, for the SURF scope
of Phase 1 of our core UK SNS gas development. They will be an
important contractor for IOG in ensuring safe and efficient Phase 1
execution, which includes the offshore pipelay campaign being
prepared for the second half of this year. We have already been
working with Subsea 7 for several months under a pre-contractual
arrangement and with the contract now finalised we look forward to
further developing our constructive relationship."
Jonathan Tame, Vice President UK & Canada, Subsea 7,
said:
"We are pleased to be awarded this contract, which strengthens
our reputation as a global provider of value-driven SURF solutions.
We look forward to collaborating with IOG to ensure the
cost-effective, safe and timely execution of each phase of the
development."
Certain information communicated in this announcement was, prior
to its publication, inside information for the purposes of Article
7 of Regulation 596/2014.
Enquiries:
Independent Oil and Gas plc
Andrew Hockey (CEO)
Rupert Newall (CFO)
James Chance (Head of Corporate Finance & IR) +44 (0) 20 7036 1400
finnCap Ltd
Christopher Raggett (Corporate Finance)
Simon Hicks (Corporate Finance)
Camille Gochez (ECM) +44 (0) 20 7220 0500
Peel Hunt LLP
Richard Crichton
David McKeown +44 (0) 20 7418 8900
Vigo Communications
Patrick d'Ancona
Chris McMahon
Simon Woods +44 (0) 20 7390 0230
About IOG:
IOG owns and operates a 50% stake in substantial low risk, high
value gas reserves in the UK Southern North Sea. The Company's Core
Project targets a gross 2P peak production rate of 140 MMcfe/d (c.
24,000 Boe/d) from gross 2P gas Reserves of 302 Bcfe(1) + 2C gas
Contingent Resources of 108 Bcfe(2), via an efficient hub strategy.
In addition to the independently verified 2P reserves at Blythe,
Elgood, Southwark, Nailsworth and Elland and 2C Contingent
Resources at Goddard, IOG also has independently verified best
estimate gross unrisked prospective gas resources of 73 Bcfe(2) at
Goddard. Alongside this IOG has management estimated mid-case
recoverable gas volumes of 40 Bcfe and 100 Bcfe at the Harvey and
Redwell licences and continues to pursue value accretive
acquisitions to generate significant shareholder returns.
(1) ERC Equipoise Competent Persons Report: October 2017,
adjusted by Management to account for updated project timing and
compression
(2) ERC Equipoise Competent Persons Report: October 2018
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END
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