Valeura Energy has announced the final investment decision (FID) on the redevelopment of the Wassana field, which is expected to substantially enhance shareholder value.
The field, located in Licence G10/48 with a 100% interest held by Valeura, is situated offshore the Gulf of Thailand.
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The redevelopment includes the construction of a new central processing platform (CPP) to fully optimise the potential of the entire block.
The Wassana field redevelopment is projected to yield first oil by the second quarter of 2027, with an expected peak production rate of 10,000 barrels per day (bpd), more than two and a half times the current output.
The company has reported a significant increase in proved plus probable (2P) reserves to 20.5 million barrels (mbbl), representing an increment of 18mbbl compared with the existing infrastructure’s continued production.
The extension of the field’s life to 2043, a 16-year increase, is another highlight of the redevelopment plan.
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By GlobalDataThe estimated investment in facilities over the next two years is $120m, with $40m allocated for 2025 and the remainder for 2026. This investment will be fully funded from the company’s balance sheet.
The redevelopment is expected to be highly accretive, with the Wassana 2P net present value before tax increasing to $218m, equating to a net asset value addition of C$1.23 ($0.88) per share.
The economics are strong and resilient, with an estimated 40% internal rate of return at $60 per barrel Brent oil prices and a payback period of 18 months.
The current production from the Wassana field is through a mobile offshore production unit (MOPU), which has an expected end-of-life by the end of 2027.
The MOPU’s limitations in terms of well drilling capacity and oil and fluid processing have necessitated the redevelopment. Additionally, the MOPU’s age and processing system have resulted in the highest unit adjusted opex among Valeura’s assets in the Gulf of Thailand.
After reviewing various redevelopment concepts, Valeura has chosen a new CPP with 24 production well slots as the optimal solution to achieve the highest financial returns and maximum oil recovery from the G10/48 licence.
The new CPP will enable more extensive drilling and a longer facility design life, leading to increased cash flow generation.
Thai Nippon Steel Engineering & Construction has been selected for the engineering, procurement, construction and commissioning of the new facility.
The company’s contracting strategy ensures more than 80% of the $120m facility capex is under fixed price commitments, with key long-lead items already secured.
Valeura Energy president and CEO Sean Guest said: “Our final investment decision to pursue the Wassana redevelopment project is a milestone for Valeura. Since assuming operatorship, we have identified substantially more reserves than were initially estimated at the Wassana field.
“Beyond the significant increase in reserves and extension of field life, this project is expected to significantly increase production from the field to 10,000bbl/d [barrels per day] in the second half of 2027, at anticipated unit Adjusted Opex reflecting a reduction of approximately 2/3 versus current rates.”
Valeura Energy has also recently completed an infill drilling campaign at the Manora field in Licence G1/48, which has increased the company’s production share to 2,866bbl/d over the past two weeks.
The campaign has identified further potential drilling targets, which will be assessed for future drilling programmes.
