Johan Sverdrup to Reach Plateau Production Early
Equinor now expects the North Sea’s Johan Sverdrup field to reach plateau production for the first phase in early May, sooner than anticipated. Due to higher plant capacity, plateau production will jump from about 440,000 barrels of oil per day to 470,000 bopd.
Previously, plateau production was expected to be reached during the summer. But at the end of March, daily production had already surpassed 430,000 barrels of oil. Equinor is the field operator (42.6%) and its partners include Lundin Norway (20%), Petoro (17.36%), Aker BP (11.6%) and Total (8.4%).
“Johan Sverdrup is an important project to the companies, the industry and society at large. The project was sanctioned during the oil price fall in 2015 and resulted in important activity to the supplier industry in a demanding period. With low operating costs Johan Sverdrup provides revenue and cashflow to the companies and Norwegian society at large in a period affected by the coronavirus and a major drop in the oil price. In today’s situation, cooperation between operators, suppliers and authorities is more important than ever to maintain activity and value creation,” Arne Sigve Nylund, executive vice president for Development and Production Norway, said in a written statement.
“Field production has been very good and stable from day one, and the wells have produced even better than expected,” Rune Nedregaard, vice president for Johan Sverdrup operations, said in a written statement. “We are currently completing the tenth well. This work is progressing smoothly, helping reach higher production earlier than expected. We also expect to increase plant capacity, allowing plateau production to increase from the previously expected 440,000 barrels to around 470,000 barrels of oil per day.”
Johan Sverdrup is the third largest oil field on the Norwegian continental shelf, with expected resources of 2.7 billion barrels of oil equivalent. At plateau the field is expected to produce 690,000 barrels of oil per day, which will make up about one-third of oil production on the NCS. Management is aiming for a recovery factor of more than 70 percent in the field.
Currently, the break-even price for the full-field development is below $20 per barrel. After reaching plateau for the first phase, the expected operating costs are below $2 per barrel.
Phase 1 of the Johan Sverdrup field was approved by Norwegian authorities in 2015 and came on stream in October 2019. Phase 2 of the development was approved in 2019 and is expected to start production in Q4 2022.
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