Hurricane Energy PLC

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Hurricane Energy PLC

Type	Public limited company
Traded as	LSE: HUR
ISIN	🆔
Industry	Oil and gas
Founded 📆	2004
Founder 👔
Headquarters 🏙️	Godalming, Surrey, England, UK
Area served 🗺️
Key people	Steven McTiernan (Chairman) Beverley Smith (Interim CEO) Richard Chaffe (Acting CFO) Steve Holmes (Acting COO)
Products 📟	Petroleum and natural gas
Revenue🤑	$170.3 million (2019)
Operating income	$-1.812 million (2019)
Net income	$58.675 million (2019)
Members
Number of employees
🌐 Website	www.hurricaneenergy.com
📇 Address
📞 telephone

Hurricane Energy PLC is an independent oil and gas exploration, development and production company. It specialises in naturally fractured basement oilfields and has discovered and developed oil and gas reservoirs in United Kingdom territorial waters to the West of Shetland. Hurricane Energy is currently listed on the Alternative Investment Market of London Stock Exchange.

History

Hurricane Energy was founded in 2004 by Dr Robert Trice with support from private investors. They believed that there were substantial oil resources in naturally fractured Precambrian age granitic basement structures to the West of Shetland. Hurricane Energy acquired licenses to explore a number of areas on and close to the Rona Ridge and has made a series of substantial discoveries.

Operations

Hurricane Energy's business operations are principally focused on the Greater Lancaster Area (“GLA”), which comprises the Lancaster oilfield and the Halifax discovery, and the Greater Warwick Area (“GWA”), which comprises the Lincoln and Warwick discoveries. The GLA is 100% owned by Hurricane Energy. The GWA is jointly owned with Spirit Energy, a subsidiary of Centrica, under a farm-in deal that was announced in September 2018.

Lancaster oilfield

Main article: Lancaster oilfield

The Lancaster oilfield was discovered in 2009. An Early Production System ("EPS") using the Aoka Mizu FPSO achieved first oil in June 2019 and has achieved production rates of up to 20,000 barrels (3,200 m³) of oil per day. The EPS will be used to gain a better understanding of the reservoir properties as well as generating revenue to help fund ongoing developments. A final investment decision on full field development depends upon the results from the EPS. This may involve a farm-out arrangement or Hurricane might develop the field itself.

Halifax discovery

The Halifax discovery is located in blocks 205/22b, 205/23 and 205/24 of Licence P2308. In early 2017, Hurricane Energy drilled an inclined well, 205/23-3A, and encountered a substantial column of oil and gas that is believed to be at least 1,156 metres true vertical depth. The depth of the reservoir exceeded expectations and therefore took longer to drill. As a result, adverse weather and limited time resulted in the test being curtailed before the well could be properly cleaned up and fully tested or drilled deep enough to more objectively establish the oil water contact point. The well has been suspended and it is intended that it will be re-entered and tested at a future date. Hurricane Energy believes that the Lancaster oilfield and the Halifax discovery are a single connected reservoir but further drilling will be needed to prove this hypothesis.

Lincoln and Warwick discoveries

The Lincoln and Warwick discoveries in the GWA are located in blocks 204/30b, 205/26d and 205/26b. They are covered by Licences P2294 and P1368 (South). These discoveries are jointly owned on a 50/50 basis with Spirit Energy as a result of a farm-in agreement signed in September 2018.

In November 2016, prior to the Spirit Energy farm-in deal, Hurricane Energy spudded discovery well 205/26b-12 on the Lincoln discovery. It penetrated over 800 metres of naturally fractured basement with a true vertical depth of 688 metres. The fracture network and hydrocarbons encountered were similar to those found in the adjacent Lancaster oilfield, suggesting that they originate from a similar source.

In 2019, well 205/26b-14 (Lincoln Crestal) was drilled by the joint venture and produced light crude oil with 43° API. The natural flow rate was 4,682 barrels (744.4 m³) of oil per day and the rate with electric submersible pumps ("ESPs") was 9,800 barrels (1,560 m³) of oil per day. This well has been suspended as a future producer and it is intended, subject to regulatory approval, to connect it to the Aoka Mizu FPSO that is located on the adjacent Lancaster oilfield.

The Oil and Gas Authority requires the joint venture to spud at least one additional sub vertical well before December 22 2020 in order to further establish the size of the Lincoln Field. As a result of the COVID-19 pandemic, this date has been extended by one year.

In 2019, the joint venture between Hurricane Energy and Spirit Energy drilled two wells, 205/26b-13Z (Warwick Deep) and 204/30b-4 (Warwick West), on the Warwick discovery. They demonstrate that there is a significant oil column and hydrocarbons encountered are similar to those found in the adjacent Lancaster oilfield but the flow rates were disappointing. Both wells were therefore plugged and abandoned. The information gathered from these wells is currently being analysed. It is expected that the results of this analysis will be published in an updated Competent Person's Report before the end of Q1 2021 and this will determine the next steps for the Warwick discovery.

Former prospects and discoveries

Hurricane Energy had further prospects and discoveries known as Whirlwind, Strathmore, Tempest, Typhoon and Wellington on or near the Rona Ridge but the licenses for these have all been relinquished in order that the company can focus on the GLA and GWA.

Whirlwind discovery (Licence P1368 (North), blocks 205/21a and 205/22a)

In 2010, Hurricane Energy drilled well 205/21a-5 targeting the naturally fractured basement. Oil shows were found in the Lower Cretaceous Valhall Limestone overlying the basement but the well had to be suspended due to winter weather. In 2011, the well was re-entered and oil was successfully flowed to the surface from the naturally fractured basement and from the overlying Valhall. The well was suspended and it was intended to re-enter it and drill a sidetrack at a later date. In December 2019, Hurricane announced that it intendeds to relinquish the licence for the Whirlwind discovery.

Strathmore discovery (Licence P1368 (Southwest), block 204/30a)

Unlike most of Hurricane Energy's other prospects and discoveries, Strathmore is a sandstone reservoir. It was discovered by Amerada Hess in 1991 and several wells were drilled there during the 1990s. Oil was found but the resources were not progressed. Hurricane Energy subsequently acquired the rights to the Strathmore discovery as part of the original P1368 licence but it wasn't drilled by them due to their successes and more substantial opportunities elsewhere in their portfolio. In December 2019, Hurricane announced that it intendeds to relinquish the licence for the Strathmore discovery. The Strathmore discovery is adjacent to Premier Oil's Solan oil field.

Typhoon and Tempest prospects (Licences P.1485 and P.1835, blocks 204/28, 204/27, 204/22a and 204/23a)

The Tempest prospect is an Upper Jurassic Rona Sandstone structure and Typhoon is Fractured Pre-Cambrian Basement beneath it. In 1981, BP drilled well 204/28-1 into the sandstone and underlying basement. Oil shows were found but did not flow. Hurricane Energy acquired licences P.1485 and P.1835 because it believed that the deeper, naturally fractured basement contained significant quantities of light oil but successful drilling elsewhere in their portfolio meant that they were not able to drill these prospects. They announced in December 2017 that these licenses would therefore be relinquished.

Wellington discovery (Licence P1368, block 205/24)

Well 205/24-1 was drilled by Hurricane Energy in 2006 on the southern flank of the Rona Ridge, targeting a Jurassic Rona sandstone formation. Because of an ineffective fault seal, only minor oil shows were found so the well was plugged and abandoned. The fractured basement of the Halifax discovery extends into this block beneath the Jurassic Rona sandstone formation that this well was targeting.

Other activities

On 1 February 2012, Hurricane Energy was awarded a Frontier Licence, P1884, by the OGA. This covered blocks 5/1, 5/2, 5/3, 5/4, 5/5, 5/6, 5/7, 5/8, 5/9 and 206/28 in an area between Foula and Orkney. After shooting and analysing 754km of 2D seismic data the licence was relinquished on 31 October 2013.

Summary of reserves, contingent resources and initially in place oil volumes

Summary as at 11 December 2017

Field	1P Reserves	2P Reserves	3P Reserves	1C Contingent Resources	2C Contingent Resources	3C Contingent Resources	IIP Low Estimate	IIP Best Estimate	IIP High Estimate
Lancaster	28.1	37.3	49.3	129.1	486.1	1,116.7	1,571.0	2,326.0	3,333.0
Halifax	0	0	0	268.0	1,235.0	3,379.0	2,523.0	5,157.0	9,064.0
Lincoln*	0	0	0	150.0	604.0	1,537.0	1,404.0	2,514.0	4,113.0
Warwick*	0	0	0	228.0	935.0	2,790.0	2,275.0	4,157.0	6,975.0
Total	28.1	37.3	49.3	775.1	3,260.1	8,822.7	7,773.0	14,154.0	23,485.0
Amount attributable to Hurricane Energy*	28.1	37.3	49.3	586.1	2,940.6	6,659.2	5,933.5	10,818.5	17,941.0

50% of Lincoln* and Warwick* are owned by Spriit Energy.

IIP = Initially in place.

All figures are MMBOE (million barrels of oil equivalent).

Hurricane Energy announced in July 2020 that "the Technical Committee of Hurricane's Board is re-examining the full range of possible geological and reservoir models for the Lancaster field. The 2017 Competent Person's Reports attributed independently certified reserves to the Lancaster EPS development and contingent resources associated with the overall West of Shetland portfolio. The outcome of the technical review may lead to a material downgrade of these contingent resource estimates. Any such revisions would be formally reflected in a new Competent Person's Report, currently scheduled for release no later than the end of Q1 2021."

External links

• Official website
• Oil and Gas Authority zoomable map of UK offshore oil and gas activity

This article "Hurricane Energy" is from Wikipedia. The list of its authors can be seen in its historical and/or the page Edithistory:Hurricane Energy. Articles copied from Draft Namespace on Wikipedia could be seen on the Draft Namespace of Wikipedia and not main one.

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