Statoil said in a March 6 statement that the Johan Castberg and Snorre partnerships have postponed decisions to continue with the projects. The Johan Castberg partnership postponed the decision to continue until the second half of 2016, with expectations for a final investment decision (FID) in 2017. The Snorre partnership delayed the decision to continue to fourth-quarter 2016, with expectations for an FID in fourth-quarter 2017 and expected startup of production in fourth-quarter 2022.
The Johan Castberg license achieved significant cost reductions in recent years, but the companies see further potential, the statement said.
“We have made significant progress in reducing costs for Johan Castberg. However, current challenges in relation to costs and oil prices require us to spend more time to ensure that we extract the full benefit of the implemented measures,” Ivar Aasheim, Statoil’s senior vice president for field development on the NCS, said.
Meanwhile, studies continue on the alternatives for an oil infrastructure in the Barents Sea, by a group of operators in the area including Statoil, Lundin Norway, Eni and OMV. The studies aim to assess the foundation for an onshore terminal that could support multiple fields in the Barents Sea.
The Snorre 2040 project works systematically to extend the lifespan for existing facilities, and to limit any loss of production due to the revised progress plan.
According to the statement, Snorre is one of the fields with the largest remaining oil resources on the Norwegian continental shelf. The subsurface is complex, and major investments combined with challenging profitability characterize the field’s further development leading up to 2040.
Systematic work has taken place over several years to find the right solution for this project. The conclusion is that more time is needed for the owners to reduce investment costs and improve the understanding of the reservoir.
Reserves in the Snorre field are currently estimated at 1.63 billion barrels of oil. The original estimate, when the plan for development and operation (PDO) was submitted in 1989, was around 760 million barrels of oil.
By means of a number of IOR measures and use of new technology, the recoverable reserves have more than doubled.
When the PDO was submitted, the estimated recovery rate was 25%. The current expected recovery rate is 47%, but through the Snorre 2040 project, the owners have an ambition to increase this even more.
The licensees have an ambition to increase the recovery rate on the Snorre field. The existing infrastructure has a given technical lifespan, and this will be decisive in the planning IOR measures.
Recommended Reading
Crescent Point Energy to Rebrand as Veren Inc.
2024-03-21 - The company will seek shareholder approval for the change at its upcoming annual and special meeting of shareholders on May 10.
SM Energy Adds Brookman to Board, Promotes Lebeck to Executive VP
2024-02-23 - Barton R. Brookman previously served as President and CEO of PDC Energy and James B. Lebeck served as senior vice president and general counsel since January 2023.
ArcLight Creates AlphaGen to Manage Firm’s US Power Infrastructure Portfolio
2024-01-11 - Alpha Generation, owned by ArcLight Capital Partners, will manage one of the U.S.’ largest power infrastructure portfolios with annual revenues of about $2 billion.
Mike Howard Joins Atlas Energy Solutions’ Board
2024-02-15 - Mike Howard brings more than 28 years of midstream energy experience to Atlas Energy Solutions’ board of directors.
Shell’s CEO Sawan Says Confidence in US LNG is Slipping
2024-02-05 - Issues related to Venture Global LNG’s contract commitments and U.S. President Joe Biden’s recent decision to pause approvals of new U.S. liquefaction plants have raised questions about the reliability of the American LNG sector, according to Shell CEO Wael Sawan.