Det Norske Increases Production Guidance for 2016

Norway-focused exploration and production company Det norske oljeselskap ASA announced Wednesday that it has increased its production guidance for 2016.

Det norske’s production, excluding effect of a proposed merger with BP Norge AS, is expected to average between 62,000 and 65,000 thousand barrels of oil equivalents per day this year, up from a previous guidance of between 55,000 and 60,000 boepd.

The increase is due to stronger than expected performance from the Alvheim area, said FirstEnergy Capital in a brief research note to Rigzone. Det Norske is the operator of the Alvheim field, located in the central part of the North Sea, with a 65 percent interest. The field includes the Kneler, Boa and Kameleon discoveries and is estimated to contain total recoverable resources of approximately 90 million barrels of oil equivalents net to Det norske.

Det norske also revealed Wednesday that its production cost, again, excluding effect of the proposed merger with BP Norge AS, for 2016 is expected to be around $7.0 per barrel of oil equivalent, lowered from a previous guidance of $8.0 to $9.0 per boe.

No changes have been made to the company’s guidance for 2016 capital expenditure, presented on July 14, 2016, which are expected to total between $900 and $920 million. This figure marks a reduction from the previous range due to project cost savings, according to a Det norske company statement.

The news follows the formation of a development alliance between Det norske, Subsea 7 and Aker Solutions, announced Sept. 13.

This alliance will combine Det norske’s exploration and production experience with Subsea 7’s capabilities in the engineering, procurement, installation and commissioning of subsea umbilicals, risers and flowlines (SURF) and Aker Solutions’ expertise in front end engineering, brownfield modifications and subsea systems.

As part of the collaboration the companies will form an integrated project management team with experts from each firm. This will enable continuity from one field development to another and facilitate a reuse of solutions and technology that will lower costs, reduce development time and promote safe and more efficient work methods amid a focus on continuous improvement, according to a group statement. Under the alliance, all parties will share both risks and rewards. 

“This is an innovative way of collaborating with an operator and another supplier, working together as one integrated team across developments will promote greater sharing of knowledge and best practices,” said Subsea 7 CEO Jean Cahuzac.

A graduate in journalism from Cardiff University, Andreas has eight years of experience as a business journalist. Email Andreas at andreas.exarheas@rigzone.com

WHAT DO YOU THINK?

Click on the button below to add a comment.
Post a Comment
Generated by readers, the comments included herein do not reflect the views and opinions of Rigzone. All comments are subject to editorial review. Off-topic, inappropriate or insulting comments will be removed.

Related Companies
Events  SUBSCRIBE TO OUR NEWSLETTER

Our Privacy Pledge
SUBSCRIBE

More from this Author
Andreas Exarheas
Assistant European Editor | Rigzone
 -  Ineos Shale: We Won't Drill If We Can'... (Feb 24)
 -  Rigzone's Staff Picks Top 5 Oil, Gas F... (Feb 24)
 -  Ideal Employer Survey: Students, Gradu... (Feb 23)
 -  Future Giant Discoveries Could be Lurk... (Feb 23)
 -  Petrofac Makes 29% Headcount Reduction... (Feb 22)


Most Popular Articles

From the Career Center
Jobs that may interest you
Regional Manager - Saybolt
Expertise: Business Development|Operations Management|Surveying
Location: Linden, NJ
 
Business Development Representative - Saybolt
Expertise: Business Development|Sales
Location: New Orleans, LA
 
Network Engineer II
Expertise: Engineering Manager|IT - Networking & Telecom
Location: Houston, TX
 
search for more jobs

Brent Crude Oil : $56.58/BBL 1.32%
Light Crude Oil : $54.45/BBL 1.60%
Natural Gas : $2.62/MMBtu 1.15%
Updated in last 24 hours