Valeura Energy has announced its final investment decision (FID) on the redevelopment of the Wassana field, a move set to substantially enhance shareholder value.
The redevelopment will see the construction of a new central processing platform (CPP) designed to fully optimise the potential of the entire block within Licence G10/48, offshore Gulf of Thailand, where Valeura holds a 100 per cent interest.
The project is expected to deliver first oil by the second quarter of 2027, with peak production projected at 10,000 barrels per day — more than two and a half times the field’s current output.
The company has also reported a significant increase in proved plus probable (2P) reserves to 20.5 million barrels, an increment of 18 million barrels compared to the production achievable with existing infrastructure alone.
The redevelopment will extend the field’s operational life to 2043, adding 16 years of potential production.
The estimated investment in new facilities over the next two years stands at $120 million, with $40 million allocated for 2025 and the remainder in 2026.
This investment will be fully funded from Valeura’s balance sheet.
The redevelopment is expected to be highly accretive, with the Wassana 2P net present value before tax rising to US$218 million, equating to a net asset value addition of CA$1.23 (US$0.88) per share.
The project’s economics are robust, featuring an estimated 40 per cent internal rate of return at $60 per barrel Brent oil prices and a payback period of 18 months.
Currently, production from the Wassana field relies on a mobile offshore production unit (MOPU), which is expected to reach the end of its operational life by the end of 2027.
The MOPU’s limitations in well drilling capacity and oil and fluid processing have necessitated the redevelopment.
Furthermore, 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 multiple redevelopment concepts, Valeura selected 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 chosen to handle the engineering, procurement, construction, and commissioning of the new facility.
The company’s contracting strategy ensures more than 80 per cent of the US$120 million 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 in the second half of 2027, at anticipated unit Adjusted Opex reflecting a reduction of approximately 2/3 versus current rates.”
In related news, Valeura Energy has recently completed an infill drilling campaign at the Manora field in Licence G1/48, which has increased the company’s production share to 2,866 barrels per day over the past two weeks.
The campaign has also identified further potential drilling targets, which will be assessed for future drilling programmes.
