Faroe Petroleum remains on target to drill five fully-funded exploration wells during the remainder of this year, the company said as it released its annual results Tuesday.
Faroe said its capital expenditure plans for 2013 "will be significant" with it earmarking some GBP 170 million ($258 million) to be spent during the year. GBP 120 million ($182 million) of this will be spent on exploration, with the remainder spent on producing fields.
Four wells are planned in Norway (Darwin, Snilehorn, Novus and Butch East) while one appraisal well is planned in the UK (Perth).
In its results for 2012, Faroe said that its 2P (proved and probable) reserves stood at 20.1 million barrels of oil equivalent at the end of December. 95 percent of this is associated with fields currently on production.
2012 total average production was approximately 6,900 barrels of oil equivalent per day (boepd), compared with 2,500 boepd in 2011.
Faroe noted that the Hyme field came on stream in February this year, with net production from the well during 2013 expected to be approximately 1,200 boepd. In addition, several infill wells are planned for 2013 on the Njord, Brage, Ringhorne East and Schooner fields.
In total, 2013 production is expected to be between 7,000 and 9,000 boepd.
Oil sector analysts at London-based investment bank Peel Hunt commented in a statement:
"Success at the drill bit has been modest with two key discoveries, namely Butch and Rodriguez (post year-end). However, Faroe's growth initiatives have remained robust with its successful participation in the UK (seven awards) and the Norwegian (eight awards) licencing rounds and its entry into Iceland."