Strong Future Growth Seen for Statoil's North America Operations

Strong Future Growth Seen for Statoil's North America Operations

Growth in Statoil's North American oil and natural gas production will enable the Norway-based company to achieve its goal of producing more than 500,000 barrels of oil equivalent per day (boepd) in 2020, a Statoil official said Wednesday.

Average production from Statoil's United States and Canadian fields in first quarter 2012 was 149,000 boepd, up as much as 75 percent versus first quarter 2011, said Bill Maloney, executive vice president and head of Statoil's business area for development and production in North America.

Maloney credits the successful start-up of the Leismer project in Canada and ongoing increase in U.S. shale and tight oil play production as key components in Statoil's recent production growth. Integration of Brigham Exploration, which Statoil acquired last year and has provided the company with tight oil assets in North Dakota and Montana, is progressing according to plan.

"We now have production from more than 1,000 wells and hold more than one million net acres in three of the best U.S. plays," Maloney told attendees at an investor day event in New York.

"We have a well-rounded portfolio and growth potential in all our business clusters," Maloney said. "The resource base in North America has grown well above six billion boe, representing around 30 percent of Statoil's total resource base."

Statoil's North American portfolio had a compound annual growth rate of over 20 percent in the past decade, and the company anticipates strong future growth for its North America operations.

The company also is moving forward with development of an operational organization in Houston for its Eagle Ford operatorship, which is expected to begin in 2013.

Statoil plans to drill 11 wells in the Gulf of Mexico as part of its 2012-2013 exploration program, including six wells operated by Statoil. The company also will drill an appraisal well next year at its Logan discovery, a Paleogene prospect in the Walker Ridge area. While significant quantities of oil in place, the recovery potential is uncertain, Maloney said.

"Our ambition is to apply technology and experience from the Norwegian Continental Shelf to the deeper and more complex reservoirs in the Gulf of Mexico," said Maloney. "Over several years, we have worked on a technology program called 'Crack the Paleogene'. We hope elements from this technology tool kit will help us profitably develop the Logan discovery."

Offshore Canada, the company will drill two to three exploration wells near its Mizzen discovery, now estimated to hold recoverable volumes of 100 to 200 million barrels, to determine the resource potential of the Flemish Pass Basin.


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