North Sea Giant Comes Online
The Johan Sverdrup field started production on October 5, Equinor has revealed.
Output start-up occurred more than two months ahead of, and $4.3 billion (NOK 40 billion) below, original estimates, the company, which describes the field as “the North Sea giant”, highlighted.
Johan Sverdrup has expected recoverable reserves of 2.7 billion barrels of oil equivalent and will produce up to 660,000 barrels of oil per day at plateau, according to Equinor.
“Johan Sverdrup coming on stream is a momentous occasion for Equinor, our partners and suppliers,” Eldar Saetre, president and CEO of Equinor, said in a company statement.
“At peak, this field will account for around one third of all oil production in Norway and deliver very valuable barrels with record low emissions,” he added.
Anders Opedal, executive vice president for technology, projects and drilling at Equinor, said, “Johan Sverdrup is a giant development, built across nearly 30 construction sites in Norway and globally, and the field center assembled in the North Sea counts as one of the largest on the NCS”.
“Sanctioned right at the beginning of the downturn in the oil and gas industry, it helped ensure activity for tens of thousands of people, especially in Norway, at a critical time for many,” he added.
Wood Mackenzie Research Analyst Jamie Thompson said Johan Sverdrup is “world-class” and a “company-maker” and added that the asset “will generate excellent returns almost immediately”.
“But perhaps most strikingly, it was discovered in a mature basin, in an area thought to be fully explored,” Thompson added.
“It will be held up as an example of how new thinking can defy traditional maturity metrics,” he continued.
Since Lundin Petroleum hit oil at Johan Sverdrup almost ten years ago, Norwegian exploration has fallen on “hard times”, according to Thompson.
“The next big fields due on stream are in the Norwegian sector of the Barents, an area where exploration has under-performed of late and there are larger questions marks over its viability,” Thompson stated.
“But to write off Norway would be to forget the ignore the lessons of Johan Sverdrup’s discovery. Mature areas can still deliver world-class finds. You ignore them at your peril,” he added.
Equinor holds a 42.6 percent operated interest in Johan Sverdrup. Lundin Norway holds a 20 percent stake, Petoro holds a 17.36 percent interest, Aker BP holds an 11.5733 percent interest and Total holds the remaining 8.44 percent.
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