Statoil Ceases Oil Development at Snohvit

The Snohvit partnership has decided to cease all work relating to oil zone development at the Snohvit field in the Barents Sea. Evaluations undertaken show that such a development would not be economically viable.

An appraisal well was drilled in the Snohvit structure earlier in the summer. Its purposes included to confirm the presence of oil and the thickness of the oil zone in its western part.

The well confirmed the presence of oil with well data being analyzed and evaluated together with other geological information.

"These analyses show the presence of oil to be significantly less than we expected to find in this structure," says Geir Pettersen, senior vice president for the Tromso Patch business cluster.

"When this is now evaluated alongside possible development solutions and current costs, it becomes clear that it isn't economically viable to develop and produce oil from the area," Mr Pettersen informs.

"This decision is final, since the start-up of gas production from Snohvit shortly will prevent the oil zone being developed at a later stage."

The Norwegian government has been informed of the decision.

Licensees in the Snohvit field are Statoil with a 33.53% interest, Petoro (30.00%), Total E&P Norge (18.40%), Gaz de France (12.00%), Hess Norge (3.26%) and RWE Dea with 2.81%.

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