Scottish oil and gas firm Cairn Energy expects to increase drilling activity in the North Sea this year.
The Edinburgh-headquartered company said it would participate in the drilling of multiple exploration and appraisal wells over the next 12 months, with the immediate focus on the Skarfjell discovery off Norway and the Kraken field in the central North Sea.
Cairn said it has interests in 40 North Sea licence areas.
It said that it would use expected cash flows from two oil wells which are nearing production to fund opportunities elsewhere.
The firm has spent an extended period trying to find oil in Greenland and said that it hoped to begin exploration drilling in the Pitu Baffin Bay prospect next year.
Cairn also has interests in the Mediterranean and northern Africa, and expects to start drilling the Juby Maritime prospect off Morocco in the fourth quarter of this year.
The group held net cash of $1.6 billion at Hogmanay.
Its residual interest in Cairn India Ltd the frontier where the company established its name was valued at $1.1bn.
Over the next five years Cairn expects to spend up to £2bn on its development assets with an additions average annual outlay of between $250m and $300m on its exploration and appraisal programme.
Chief executive Simon Thomson said: “During 2012, the company has established a balanced portfolio of development and exploration assets.
“Our balance sheet strength means we are funded for all planned exploration and development, whilst retaining the flexibility to consider further opportunities.
“Our North Sea properties, now at late pre-development stage will, when on stream, provide cash flows to sustain future exploration programmes.
“This solid foundation, combined with the company’s growing exploration portfolio, provides the basis for multi-year and multi-well programmes.
“Operated exploration wells will focus on frontier basins offering transformational potential, whilst non-operated exploration drilling activity will focus on the North Sea, where we bring a distinct knowledge edge.”
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