STAVANGER, Norway—Statoil has brought a relatively small two-well subsea tieback project onstream four months earlier than scheduled at half of the development cost originally envisaged.

The Norwegian operator gave itself an early Christmas present by confirming first production from the Gullfaks Rimfaksdalen Field well ahead of its Dec. 24 scheduled startup.

The original development cost for the project was NOK 8.8 billion (US$1 billion), according to Arne Sigve Nyland, executive vice president of development and production for Statoil. After undergoing an intensive cost reduction exercise, this fell to NOK 4.8 billion (US$580 million) by the time the plan for development and operation was submitted.

Since then, the project’s development cost has dropped to NOK 3.7 billion (US$445 million).

Nyland admitted that when the project was first mooted, it was at a time of “higher oil prices but also higher costs.” He described the oil price downturn as having been “a true wake-up call for the entire industry.” For Statoil, the challenging times meant improving the way the company works with its partners and suppliers.

However, this project “is a sign of recovery, not of the market, but that the industry is recovering,” he added. “We are gradually regaining our competitiveness on the Norwegian Continental Shelf.”

Recoverable reserves from Gullfaks Rimfaksdalen are about 80 million barrels of oil equivalent (MMboe), mostly gas. The licensees are Statoil (operator, 51%), Petoro (30%) and OMV (19%).

The development consists of a standard subsea template in a water depth of about 135 meters, or 443 ft, with two gas production wells and the possibility for the tie-in of two more wells.

The wellstream is connected to an existing pipeline leading to the Gullfaks A Platform.

Existing pipelines transport gas and condensate to the processing plant at Kårstø, north of Stavanger, for processing. From there, the gas is exported to markets on the European continent.

Nyland also pointed out that Statoil currently has 30 projects in the non-sanction phase, where the company has reduced the estimated breakeven cost from $70/bbl to currently $41/bbl as it continues its cross-company cost-efficiency drive.

—Mark Thomas

Offshore