EnQuest's Kraken field in the North Sea delivers first oil

 
Courtney Goldsmith
Follow Courtney
EnQuest has use innovative methods to keep costs down
EnQuest has use innovative methods to keep costs down (Source: EnQuest)

North Sea explorer EnQuest's shares jumped this morning after it revealed its Kraken field delivered first oil last week.

Shares in the firm rose 8.47 per cent to 32p.

The Kraken oil field, which is one of the largest projects in the North Sea to come on-stream in a decade, was delivered on schedule and under budget.

"Kraken is a transformational project, made possible by EnQuest’s differential capabilities; the right mix of integrated technical capabilities, high levels of efficiency and cost discipline," said Amjad Bseisu, chief executive at EnQuest.

With Kraken now producing, EnQuest shifts from a period of heavy capital investment to a focus on cash generation and deleveraging the balance sheet, Bseisu said.

Greg Clark, business and energy secretary, called it a "landmark" project for the UK oil and gas industry. "We’ll continue to build on this support for the oil and gas sector as it looks to seize the significant opportunities that lie ahead," Clark said.

Oil companies including EnQuest have struggled to turn a profit while crude prices remain low.

Oil & Gas UK chief Deirdre Michie said EnQuest has taken a variety of innovative and efficient steps successfully to complete the large Kraken development while keeping costs down.

"First oil from Kraken is good for EnQuest and good for our industry. It demonstrates once again what the North Sea can still deliver with the right approach and investment," Michie said.

A further update and additional analysis will be provided with EnQuest’s 2017 half year results, the company said.

Read more: EnQuest agreed to buy a stake in a BP oil field

Related articles