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Premier Oil scales back Falklands oil project on weak oil price

Reuters - UK Focus

LONDON, Nov 13 (Reuters) - Oil and gas explorer Premier Oil (LSE: PMO.L - news) has scaled back its Sea Lion oil field project north of the Falkland Islands (Other OTC: FLKDF - news) as weak oil prices have put pressure on the company to cut costs.

The London-listed oil firm now plans to develop fewer wells at the site for less than the initally targeted $2 billion project capital expenditure.

"The new lower oil price environment and our commitment to maintaining a strong financial position has caused Premier (NasdaqGS: PINC - news) to re-examine the scheme with a view to reducing the capex," the company said in its third-quarter results statement.

The smaller project is expected to recover 160 million barrels of oil in 15 years, Premier Oil said.

The energy firm also maintained its full-year production guidance at the upper end of of 58,000-63,000 barrels of oil, despite previous indication it may raise its forecast on the back of higher-than-forecast production earlier this year. (Reporting by Karolin Schaps; editing by David Clarke)