LONDON (Dow Jones), Feb. 24, 2010
The Norwegian Petroleum Directorate downgraded total reserves at Royal Dutch Shell PLC's (RDSA) Ormen Lange gas field by around a quarter Wednesday following what the company described as disappointing appraisal wells on the northern portion of the field.
A Shell spokeswoman said the cut will only affect gas production from the field towards the back end of its life and won't reduce the reserve volume that Shell has booked under U.S. Securities and Exchange Commission rules for the developed part of Ormen Lange.
Ormen Lange produces about 70 million cubic meters a day of gas, much of which supplies the U.K.'s growing gas import needs through the Langeled pipeline.
Ormen Lange has been developed with three subsea installations, two of which are in the middle of the field and one in the south. The disappointing appraisal well, drilled late last year six kilometers northeast of the field's main production area, could affect Shell's plan to locate a fourth installation in that portion of the field, although Shell wouldn't confirm this.
The NPD cut its estimate of total gas and condensate resources at the field to 320.3 million cubic meters of oil equivalent from 423.3 million cubic meters of oil equivalent previously.
Shell operates Ormen Lange, holding a 17.04% stake. DONG owns 10.34%, Exxon Mobil (XOM) has 7.23%, state-owned Norwegian company Petoro has 36.48% and Statoil ASA (STO) has the remainder.
Copyright (c) 2010 Dow Jones & Company, Inc.
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