The Alvheim PDO outlines the companies' plans to develop the field using a floating production, storage and offloading vessel (FPSO) with subsea infrastructure consisting of five drill centers and associated flow lines. The FPSO will be a conversion of the multipurpose shuttle tanker Odin for which the Alvheim group signed a purchase and sale agreement with Statoil earlier this year. The PDO also outlines transportation of produced oil by shuttle tanker, and transportation of produced natural gas to the existing U.K. SAGE system using a new 14-inch, 24-mile cross border pipeline.
"Approval of the Alvheim PDO places us one step closer to bringing this important development on production in 2007," said Steven B. Hinchman, Marathon senior vice president of Worldwide Production. "We are pleased that the Norwegian Ministry of Petroleum and Energy has approved the approach we will be taking to help commercialize the Alvheim field."
The approved Alvheim development comprises the Kneler, Boa and Kameleon fields. The Alvheim field currently is estimated to contain resources of approximately 180 million gross barrels of oil equivalent.
Recently, the Alvheim group reached agreement to tie in the nearby Vilje discovery, formerly known as Klegg, in which Marathon holds a 46.9 percent interest, subject to the approval of a Vilje PDO. Production from a combined Alvheim/Vilje development is expected to ramp up to more than 50,000 net barrels per day during 2007. The combined Alvheim/Vilje development is estimated to contain resources of approximately 200-250 million gross barrels of oil equivalent.
Marathon's partners in the Alvheim development are ConocoPhillips AS with a 20 percent working interest and Lundin Norway AS, which holds the remaining 15 percent interest. The Alvheim field applies to Production Licenses PL 203, PL 088BS and PL 036C on the Norwegian Continental Shelf.
Norsk Hydro Produksjon a.s. holds a 28.531 percent interest in Vilje and serves as operator. Other Vilje interest owners are Marathon Petroleum Company (Norge) (46.904 percent), TOTAL E&P Norge AS (24.243 percent), and AS Ugland Rederi (0.322 percent) as licensees in PL 036 on the Norwegian Continental Shelf.
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