September 24, 2010 / 9:28 PM / in 8 years

UPDATE 1-Nexen advances hook-up of North Sea platform

* Fourth platform due to start up in Q4

* Output expected to return to full rates by year-end

CALGARY, Alberta, Sept 24 (Reuters) - Nexen Inc NXY.TO said on Friday it will hook up a new platform at its Buzzard oil field in the North Sea earlier than planned, forcing a cut of up to 30 percent in fourth-quarter production at the major project while the work is being done.

Nexen, Canada’s No. 5 independent oil explorer, said its overall annual production should still be in the range of 230,000-280,000 barrels a day before royalties despite the decision to move up the work on Buzzard.

The company said it is advancing the start-up of the field’s fourth platform to October to take advantage of lower costs. The work on the largest oilfield in the U.K. North Sea had been scheduled for early next year.

Production there is expected to return to full rates before the end of the year.

“Many of the people currently involved in hook-up and commissioning activities are the same people that will be involved in the start-up,” Chief Executive Marvin Romanow said in a statement. “By moving immediately to the start-up phase, we maximize cost efficiencies and shorten operational disruptions.”

The cut in output in the Buzzard field should not affect Nexen’s annual production targets because of increasing output at the Ettrick Field in the North Sea and at the Long Lake oil sands project in Alberta, the company said. Also, new shale gas assets are slated to start producing in the fourth quarter.

Nexen shares rose 55 Canadian cents, or nearly 3 percent, to C$19.92 on the Toronto Stock Exchange on Friday.

$1=$1.02 Canadian Reporting by Jeffrey Jones; editing by Peter Galloway

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