REG - Ithaca Energy PLC Delek Group - DLEKG - Ithaca Energy Development of the Rosebank Field

Ithaca EnergyAnnouncement

27/09/2023 07:00

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RNS Number : 8114N  Ithaca Energy PLC  27 September 2023

Press release

DISCLAIMER: CONTAINS INSIDE INFORMATION

THIS ANNOUNCEMENT CONTAINS INSIDE INFORMATION PERTAINING TO ITHACA ENERGY PLC

 

Ithaca Energy plc

("Ithaca Energy" or the "Group")

 

Ithaca Energy announces development of the Rosebank field

 

Ithaca Energy, together with Equinor (the Operator), are delighted to announce
that they have taken the final investment decision to progress Phase 1 of the
Rosebank development on the UK Continental Shelf, together investing $3.8
billion in the development. The North Sea Transition Authority ("NSTA")
granted consent for the development of the field on 27 September 2023. Ithaca
Energy owns a 20% working interest in Rosebank.

 

The Rosebank field is located around 130 kilometres north-west of Shetland.
Recoverable resources are estimated at around 300 million barrels of oil from
phase 1 and 2, with Phase 1 targeting an estimated 245 million barrels of oil.
The field will be developed with subsea wells tied back to a redeployed
Floating Production Storage and Offloading vessel ("FPSO"), with first
production expected in 2026-2027. The Rosebank field will produce in excess of
21 MMSCF of natural gas every day, the equivalent to the daily use of Aberdeen
City.

 

The Rosebank development has been optimised to reduce carbon emissions, in
line with the North Sea Transition Deal, with the FPSO designed to be
electrification-ready. Ithaca Energy and Equinor continue to collaborate with
government and industry stakeholders to pursue a regional solution for power
from shore to Rosebank and nearby fields with the objective of minimising
carbon emissions from production.

 

The Rosebank development is expected to lead to £8.1 billion(1) of total
direct investment, of which 78% is likely to be invested in UK-based
businesses. It is expected to support around 1,600 jobs during the height of
the construction phase of the project, and it will continue to support approx.
450 UK-based jobs during the lifetime of the field.

 

The following contracts have been awarded in relation to the development:

 

·    TechnipFMC has been awarded an integrated engineering, procurement,
construction and installation (iEPCI™) contract for subsea production
systems, umbilicals, risers and flowlines with an estimated value of $500
million derived locally. TechnipFMC has estimated that more than half of the
contract value will be generated from local activities across the UK, with a
large portion in Scotland.

 

Project management and engineering activities will be performed mainly from
Aberdeen and tree systems will be manufactured in Dunfermline. Umbilicals will
be produced in Newcastle, pipelines will be fabricated in Evanton and the main
vessel mobilisation site will also be in the UK. In addition, several other
fabrication sites in the UK will contribute to the project.

 

·    Odjfell Drilling has been awarded a rig contract, with an estimated
value of $328 million including options, integrated services and other
modifications. The Deepsea Atlantic mobile rig is scheduled to start a
seven-well drilling campaign in the second quarter of 2025, and an additional
four single well options are included.

 

·    Altera has been awarded a bareboat charter and an operations and
maintenance contract related to the Petrojarl Knarr FPSO which is set to be
deployed for Rosebank on a firm contract for nine years, with options up to a
total of 25 years.

 

 

Gilad Myerson, Executive Chairman, Ithaca Energy, commented: "We are delighted
to announce the decision to move forward with the Rosebank development
alongside Equinor. Rosebank stands as the largest undeveloped field in the UK,
and with the receipt of development consent from the NSTA, we are now poised
to embark on a journey that will not only provide critically important
domestic energy but also ignite substantial economic impact. The Rosebank
project will create thousands of jobs and contribute significantly to securing
the UK's energy needs for many years to come."

 

Alan Bruce, Chief Executive Officer, Ithaca Energy, commented: "Ithaca Energy
continues to deliver against its stated strategy and demonstrate its
commitment to investing in the UK North Sea. We look forward to expanding our
working partnership with Equinor to deliver one of the lowest emission
intensity assets in the UK. The Rosebank development represents a significant
investment in the UK and Scotland, and we are delighted to be supporting our
local supply chain."

 

Notes:

 

(1) Source: Socioeconomic report prepared by Wood Mackenzie and Voar Energy

 

Enquiries

 

 Ithaca Energy
 Kathryn Reid - Head of Investor Relations, Corporate Affairs &      kathryn.reid@ithacaenergy.com (mailto:kathryn.reid@ithacaenergy.com)
 Communications

 FTI Consulting (PR Advisers to Ithaca Energy)                       +44 (0)203 727 1000
 Ben Brewerton / Nick Hennis                                         ithaca@fticonsulting.com (mailto:ithaca@fticonsulting.com)

 

 

About the Rosebank development:

 

·    The Rosebank field, operated by Equinor, is an oil and gas field
located about 130km west of the Shetland Islands on the UK continental shelf.

·    The Rosebank partners: Equinor (80%) and Ithaca Energy (20%).

·    Rosebank is planned to be delivered in two phases.

·    The Rosebank development has been optimised to reduce operating
carbon emissions and the FPSO will be prepared for future electrification.

·    With electrification, it is estimated that the Rosebank lifetime
upstream CO2 intensity would decrease from 12kg to about 3kg CO2/boe.

·    The expected recoverable resources are over 300 million barrels of
oil for Phase 1 and 2.

·    Production from the field will be through subsea wells tied back to a
redeployed FPSO for processing and offloading at the Rosebank field.

·    Oil will be transported to refineries by shuttle tankers, while gas
will be exported through the West of Shetland Pipeline system.

·    Rosebank is expected to begin production in 2026-2027.

 

 

About Ithaca Energy plc

 

Ithaca Energy is a leading UK independent exploration and production company
focused on the UK North Sea with a strong track record of material value
creation. In recent years, the Company has been focused on growing its
portfolio of assets through both organic investment programmes and
acquisitions and has seen a period of significant M&A driven growth
centred upon two transformational acquisitions in recent years. Today, Ithaca
Energy is one of the largest independent oil and gas companies in the United
Kingdom Continental Shelf (the "UKCS"), ranking second by resources.

 

With stakes in six of the ten largest fields in the UKCS and two of UKCS's
largest pre-development fields, and with energy security currently being a key
focus of the UK Government, the Group believes it can utilise its significant
reserves and operational capabilities to play a key role in delivering
security of domestic energy supply from the UKCS.

 

Ithaca Energy serves today's needs for domestic energy through operating
sustainably. The Group achieves this by harnessing Ithaca Energy's deep
operational expertise and innovative minds to collectively challenge the norm,
continually seeking better ways to meet evolving demands.

 

Ithaca Energy's commitment to delivering attractive and sustainable returns is
supported by a well-defined emissions-reduction strategy with a target of
achieving net zero by 2040.

 

Ithaca Energy plc was admitted to trading on the London Stock Exchange (LON:
ITH) on 14 November 2022.

 

-ENDS-

 

 

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