Alpha Petroleum and GE Oil & Gas to partner on North Sea’s Cheviot oil field
- As sole subsea partner, GE Oil & Gas will provide the full Subsea and SURF scope for the subsea development
of the field
- GE Energy Financial Services in discussions to make a capital investment towards the project, subject to due diligence
- The agreement represents an innovative and collaborative approach between Alpha Petroleum and GE
London, 22 May, 2017: Alpha Petroleum, which is backed by upstream oil and gas investment firm Petroleum Equity, today announces an agreement with GE Oil & Gas to partner on the advancement of the subsea infrastructure for the Cheviot oil field, one of the largest undeveloped fields in the UK North Sea with 55 mmbbls of oil and 20 mmboe of future gas production. Alpha Petroleum has named GE Oil & Gas as the exclusive supplier of early engineering, project management, and procurement activities for the project.
Today’s announcement, which follows an innovative and collaborative commercial approach between Alpha Petroleum and GE, will lead to the supply by GE Oil & Gas of subsea trees, a full control system, three manifolds, flexible jumpers, flowlines, risers and umbilicals. GE Oil & Gas will also provide subsea construction and installation services, and support commissioning.
In addition to the provision of services and technologies, GE Energy Financial Services is helping to raise the needed debt financing for the project and is in discussion with Alpha Petroleum with the intention, subject to due diligence, of making a significant capital investment at the time of final investment decision (FID), which is expected in the fourth quarter of 2017. FID is the point at which the project is awarded UK Government approval, allowing agreed construction contracts to be executed.
GE Energy Financial Services is GE’s energy investing business with deep domain experience in oil and gas infrastructure investing.
For more than 12 months, Alpha Petroleum, Petroleum Equity and GE have collaborated closely, co-creating from project inception the scope of delivery and equipment specifications required to meet Alpha Petroleum’s performance objectives.
Andy Crouch, Alpha Petroleum’s Chief Executive said: “By taking this unconventional, collaborative approach, we have been able to really draw on GE’s expertise, enabling us to
minimise costs and timescales. This partnership marks another key milestone in Cheviot’s development and we are excited to see the project move forward to the next stage.”
“Through this full life-of-field partnership, Alpha Petroleum is defining the performance characteristics they require and empowering GE Oil & Gas to design the necessary solutions. While the benefits are clear, this represents another very positive example of how the traditional, transactional relationship between industry players is evolving into a partnership approach,” said GE Oil & Gas Europe CEO, Michele Stangarone.
The Cheviot field is 100 per cent owned by Alpha Petroleum and its core development will consist of 18 firm and 5 contingent wells. Alpha Petroleum recently announced an exclusivity agreement with Teekay Offshore Partners L.P. on the project for use of its Varg Floating Production Storage Offloading unit as well as FEED capabilities to the project. First oil is expected in 2019 at an expected rate of at least 30,000 barrels per day.
Arun Subbiah, founding partner at Petroleum Equity, commented, “It is extremely satisfying to see Alpha Petroleum making such great strides towards realising the potential of the Cheviot field. We have been working hand-in-hand with Alpha on the project since we first invested back in 2014 and are all delighted to have attracted a partner of GE’s calibre. We see this partnership as a significant endorsement of our investment thesis and look forward to working together to bring the development to fruition.”
- End -
For further information please contact:
Alpha Petroleum/Petroleum Equity
Georgiana Brunner / Matthieu Roussellier / Daniel Oliver
Tel: +44 20 7592 2000
GE Oil & Gas
Tel: +44 7775 547 365
About Alpha Petroleum
Alpha Petroleum Resources Limited is a privately owned upstream oil and gas operator, focusing on operated appraisal, development and production activities in the UK sector of the North Sea. Alpha was established in 2000, acquired its first three licences in 2001, was appointed as a Production Operator in 2002 and achieved first production from its Helvellyn gas field in early 2004. Three further gas fields – Kilmar, Wenlock and Garrow – were brought on stream in the period 2005-2007. Alpha is now focusing on the development of the Cheviot project and looking for opportunities to expand the current portfolio. For further information visit: www.alphapetroleum.com
GE (NYSE: GE) is the world’s Digital Industrial Company, transforming industry with software-defined machines and solutions that are connected, responsive and predictive. GE is organised around a global exchange of knowledge, the “GE Store," through which each business shares and accesses the same technology, markets, structure and intellect. Each invention further fuels innovation and application across our industrial sectors. With people, services, technology and scale, GE delivers better outcomes for customers by speaking the language of industry. To learn more, please visit www.ge.com
About GE Oil & Gas
GE Oil & Gas is inventing the next industrial era in the oil and gas sector. In our labs and factories, and in the field, we constantly push the boundaries of technology to solve today’s toughest operational & commercial challenges. We have the skills, knowledge and technical expertise to bring together the physical and digital worlds to fuel the future. Follow GE Oil & Gas on Twitter @GE_OilandGas or visit us at www.geoilandgas.com
About Petroleum Equity
Petroleum Equity is an alternative investment firm focused on upstream oil and gas and related services & technology, primarily in Europe. The firm brings significant technical, operational, entrepreneurial and financial expertise to its investments, with the founding partners having more than 100 years’ combined experience in the European oil & gas industry. Petroleum Equity pursues a hands-on approach to driving value creation within its portfolio companies, from strategy setting to implementation.
Petroleum Equity LLP is authorised and regulated by the Financial Conduct Authority. For further information visit www.petroleumequity.com