Danish energy group Maersk is to lead a £3 billion ($4.62 billion) project to develop the largest gasfield discovered in the U.K. North Sea for a decade, the first big investment to benefit from tax breaks announced in the Budget.
The Culzean field in the central region of the North Sea is expected to produce enough gas to meet 5 percent of U.K. demand when it reaches peak output in 2020-21, the company said on Monday. It is the largest gasfield to get the go-ahead for development since East Brae in 1990.
Maersk, JX Nippon and BP discovered the gas condensate field, which holds an estimated 250 million to 300 million barrels of oil equivalent in resources, in 2008. Production is due to start in 2019 and continue for at least 13 years, peaking at 60,000-90,000 boe per day.
“Culzean is an important development for the UK and also for Maersk Oil and our co-venturers,” said Jakob Thomasen, chief executive of Maersk Oil.
The news is a rare boost for the U.K. North Sea, a high-cost region that is in long-term production decline and has been hit hard by the collapse in oil prices since last summer from more than $115 a barrel to just $50.