Premier Oil is weighing up two competing floating production solutions for the frontier development of its Sea Lion field off- shore the Falkland Islands in the South Atlantic.

The UK company has long indicated that an FPSO (Floating Production, Storage and Offloading) vessel – whether owned or leased – would be the favoured option for the field (see DI, 16 July 2012, page 1), but it has now admitted it is considering the use of a TLP (Tension Leg Platform) in combination with a Floating Storage and Offloading (FSO) vessel in an alternative bid to lower drilling and subsea costs in the remote and challenging harsh environment region. Total development Capex (gross) for Sea Lion has previously been estimated at up to US $5 billion by partner and former operator Rockhopper Exploration.

The company said in its latest results presentation that “a considerable amount of work has been undertaken on the Sea Lion project in the first six months of the year”. A subsea development tied back to an FPSO has been confirmed as a viable host scheme and a phased drilling programme selected, it said.

But it went on to say that the project team has progressed a comprehensive set of studies as part of the pre-FEED phase to refine the concept. These have included detailed work in areas such as metocean studies, FPSO design (including turret design and topsides layout), flow assurance methodologies, subsea equipment layout and installation methods, reservoir studies and well trajectories.

Those conceptual studies have indicated that a TLP with an integral drilling rig “may offer significant cost savings while providing better motion characteristics and flow assurance options. Work is now ongoing to optimise the design specifications (such as capacities and construction methods) for both the FPSO and the TLP schemes and to prepare the documentation for FEED”, it said. The TLP option has greater flexibility for infill drilling, it added. “Initialcost estimates appear attractive,” it said in a presentation.

Sea Lion sits in a water depth of 450 m (1,476 ft).

A final decision between the two is expected to be made by the end of 2013, with project sanction targeted for the end of the following year. The timing for first oil will depend on the final scheme configuration, but the project will take between 3 ½ and 4 years to bring onstream.

Those previously expected to bid for the Sea Lion FPSO include the usual suspects such as Bluewater, SBM Offshore, BW Offshore, Fred Olsen, Modec and Aker Floating Production.

A phased approach has also been selected for the development drilling program. Premier envisages that drilling will initially target the northern part of the field, to recover up to an estimated 284 MMbbl from 30 development wells, with the southern area subsequently tied back to the host facilities and estimated to eventually recover a further 110 MMbbl via another 22 development wells.

The second phase of development will be optimised to incorporate any additional exploration or appraisal success, it added. Premier is working to participate in a multi-operator exploration programme starting in the second half of 2014, which will include a well to confirm the presence of a gas cap in the west of Sea Lion.

Technologies that it intends to use subsea and subsurface include gas lift and a startup heating system to improve flow assurance. It is still currently finalising topside specifications for the eventual floater chosen, with initial production rates put at around 100,000 boe/d.

Premier became the formal operator of all the licence interests in the North Falklands Basin formerly operated by Rockhopper in November last year after a US $1 billion farm- in, taking a 60% stake. An exploration programme of at least three wells with multiple stacked targets is planned. This will include a probe on the Zebedee prospect. The well, testing the gas cap on the western flank, will also test the deeper potential Chatham prospect.

Offshore