Calgary-based oil company Nexen will spend $2.6 billion on oil and gas projects in 2009, including about 10 exploration and appraisal wells, as management aims for 10 percent more production.

Should oil average between $50 and $60 a barrel, then the company said it can expect up to $2.9 million in cash flow. Gas must also stay at US$6.50 per million British thermal units.

The drill bit, meanwhile, will target 750 million barrels of reserves.

Former company chief financial officer and incoming chief exec Marvin Romanow said the investments of Buzzard and Long Lake were in the past. Revenues from these will now fund Usan off West Africa and Horn River shale.

Romanow said, meanwhile, that 20,000 barrels per day were still shut-in on Gulf of Mexico hurricane damage.

Budget money, meanwhile, still assigns 34 percent to the fourth platform at Buzzard in the North Sea, a project “exceeding expectations”. Four production and two injection wells sill complement platform construction at Buzzard in 2009, par of a $900 million “core-project” allotment.

Elsewhere in the North Sea, the Ettrick field is seen yielding first oil early in the year, just as extra development wells go in. Importantly, “an assessment of development options” at nearby Blackbird is also planned.

Longhorn will also see first gas of 200 million cubic feet per day, while five exploration and four appraisal wells fill out North Sea activity, with three wells at the Golden Eagle and Pink discoveries. Appraisals of the Bugle and Polecat discoveries are planned, and Nexen’s first Norway exploration well is planned.

Overall, 30 percent of Nexen cash is headed for “major projects” like Usan, where detailed engineering and procrement for a floating production development are in the works.

Tags: Nexen Buzzard