BP today announced approval from the DTI for the $130 million (£74 million) development of the Farragon oil discovery. The co-venturers in this new development investment are BP (50% and operator), Eni (UK) Limited (30%) and Nexen Inc. (20%).

Farragon is located 140 miles north-east of Aberdeen in BP operated block 16/28 in the central North Sea, in water depths of 350 feet. The development of the field will involve the drilling of two horizontal wells and the installation of a subsea manifold which will be tied back to the existing Cyrus subsea manifold.

Oil produced from Farragon will be processed through existing facilities on the Andrew platform and onwards to the Forties Pipeline System. First oil from Farragon is expected late 2005.

A mobile semi-submersible drilling rig, the GSF Arctic IV, has been contracted for work on the project. The contract for subsea installation was recently awarded to Subsea 7.

Tim Summers, Director & Business Unit Leader for BP’s North Sea business said, “Farragon is an exciting part of BP’s 2005 activity plans, and our team have done a fantastic job in bringing the project from exploration discovery to development in only 18 months. This investment will help to maximize recovery of oil and gas from the North Sea, and demonstrates what can be achieved through enthusiasm, innovation and cooperation in a stable business environment.”