Scotland-based Cairn Energy said Tuesday it was fully committed to developments in the North Sea despite grim forecasts for the regional energy sector.
"Cairn is fully funded to deliver its exploration and appraisal program, along with the Kraken and Catcher developments [in the North Sea,] which are on track for first oil in 2017," Chief Executive Simon Thomson said in a statement.
The company expects net peak production from the North Sea assets of around 20,000 barrels of oil equivalent per day. First steel for a floating production, storage and offloading vessel committed for Catcher is set to begin during the first half of the year. Development drilling will soon follow.
FPSO construction for a Kraken structure is underway at a facility in Singapore.
The announcement comes as analysts predict a downturn in the North Sea because of the steady drop in crude oil prices, off more than 50 percent from their June values.
Oil production from the North Sea has been in decline since the late 1990s. Data from the British government show a decline of 7 percent from 2013, though the rate of decline is slowing.
Erin Moffat, a senior research analyst at Wood Mackenzie, said in a research note published this week North Sea exploration activity in 2014 was off 18 percent from the previous year. Only four fields were brought online.
Elsewhere, Cairn said it was keen on moving forward with a mutliwell appraisal and exploration program in Senegal, as well as developments nearby on the Norwegian continental shelf.
The company is scheduled to release preliminary year-end results for 2014 by March 10.
