Vermilion eyes first quarter activity in Alberta and the Netherlands
Vermilion Energy Inc. has approved a 2021 exploration and development capital budget of US$300 million, a 17% reduction from 2020. Some 31% of the 2021 capital budget will be invested during the first quarter, compared to 65% in 2020. The programme is expected to deliver annual average production of 83,000-85,000 boe/d.
The majority of the company’s first-half 2021 drilling programme will be allocated to its condensate-rich natural gas projects in Alberta and conventional natural gas projects in the Netherlands.
Vermilion’s light oil projects in southeast Saskatchewan, Wyoming, and France have been scaled back.
The company has reorganised the business- and reporting lines into two core regions, North America and International.
In North America, the company plans to invest US$165 million, a reduction of 37% compared with 2020. The programme includes the drilling of 10 (9.6 net) Mannville condensate-rich natural gas wells in Alberta, 25 (22.1 net) light oil wells in south-east Saskatchewan and four (3.9 net) light oil wells in Wyoming.
The company will also bring on production five (5 net) Mannville condensate-rich natural gas wells drilled in fourth-quarter 2020.
Additional light oil wells in south-east Saskatchewan and Wyoming have been identified for possible drilling during second-half 2021.
The company expects to invest US$135 million across international assets, an increase of 35% compared with 2020. The 2021 drilling programme includes two (1.5 net) natural gas wells in the Netherlands, one (1 net) natural gas well in Croatia, and one (1 net) oil well in Hungary.
Capital activity in France and Germany will be primarily focused on well workovers to preserve production. Several oil wells have been identified in France for potential drilling during second-half 2021. The previously drilled Burgmoor Z5 well (46% working interest) in Germany is expected to be brought on production in 2021.
Capital activity in the remaining international jurisdictions will be focused primarily on maintenance activities, including a one-week planned turnaround in Ireland and three weeks of planned maintenance downtime in Australia.
The company will explore certain farm out opportunities “to reduce exposure to higher risk assets in Europe,” it said.
Source: Oil & Gas Journal