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Lundin Petroleum announces 2013 capital expenditure budget of USD 1.7 billion

Monday, Jan 07, 2013

Lundin Petroleum AB (Lundin Petroleum) is pleased to announce its 2013 development, appraisal and exploration budget which totals USD 1,700 million. 2013 will be the busiest year in the company's history both in relation to exploration and development activities.

The 2013 expenditure on development projects is budgeted at USD 1,100 million which represents approximately a 150 percent increase on forecast 2012 development expenditure. The 2013 budgeted expenditure on exploration activity is USD 460 million which represents approximately 40 percent increase on the forecast 2012 exploration expenditure. The budgeted 2013 appraisal expenditure amounts to USD 150 million against a forecast 2012 appraisal expenditure of approximately USD 150 million.

Development Projects

Substantially all of the 2013 budgeted development expenditure relates to ongoing development projects in Norway.

1. The development of the Edvard Grieg field (WI 50% and operated by Lundin Petroleum) commenced in 2012. The 2013 net expenditure is budgeted at close to USD 550 million which will involve ongoing engineering and construction of the jacket, topside and export pipelines. 

2. The development of the Brynhild field (WI 90% and operated by Lundin Petroleum) is progressing well and first production is scheduled to come onstream in the fourth quarter of 2013 at a net plateau rate of 10,800 barrels of oil equivalent per day (boepd). The 2013 net development expenditure is budgeted at approximately USD 470 million which includes topside modification of the Haewene Brim FPSO, subsea facilities construction and installation and the drilling of production and water injection wells.

3. The non-operated Bøyla field (WI 15%) which will be tied back to the Alvheim FPSO received development approval in 2012. The 2013 net development expenditure is budgeted at approximately USD 40 million which predominantly involves engineering, procurement and fabrication of subsea and topside equipment. The field is scheduled to come onstream in the fourth quarter of 2014 at a net plateau rate of approximately 3,000 boepd.

Exploration Activity

The exploration budget for 2013 is USD 460 million with a major focus on Norway which accounts for approximately 70 per cent of this amount. The exploration programme (excluding appraisal) involves the drilling of 18 exploration wells in Norway, Malaysia, Indonesia, France and the Netherlands.

1. Norway
The budgeted net exploration expenditure for 2013 is USD 330 million. A total of ten exploration wells will be drilled in Norway during 2013. A significant proportion of the 2013 exploration expenditure will be focused around the Utsira High Area with six exploration wells targeted in the area, on PL625 (WI 40%), PL338 (WI 50%), PL359 (WI 40%), PL544 (WI 40%), PL501 (WI 40%) and PL410 (WI 70%) all of which are operated by Lundin Petroleum. Two exploration wells will be drilled in the southern North Sea on PL495 (WI 65%) and PL453 (WI 35%) both of which are operated by Lundin Petroleum. One operated exploration well will be drilled in the Barents Sea on PL492 (WI 40%) and one non-operated exploration well will be drilled on PL330 (WI 30%) in the northern part of the Norwegian Sea.

 2. South East Asia
The budgeted net exploration expenditure for 2013 is approximately USD 115 million. Three exploration wells will be drilled in Malaysia of which two will be drilled offshore Peninsular Malaysia and one well offshore Sabah. Two exploration wells will be drilled offshore Indonesia; on the Baronang (WI 100%) and Gurita (WI 100%) licences respectively.

Source: Lundin Petroleum

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