Statoil Assessing Carbon Injection on Volve

Statoil aims to study opportunities for injecting carbon dioxide to achieve improved oil recovery (IOR) from its Volve discovery near the Sleipner fields in the North Sea.

Should such action prove viable, and the government contributes necessary infrastructure, Volve could become the world's first development to use carbon injection for IOR.

"This field could prove a first step towards a unified carbon value chain, where the oil industry and the authorities combine to handle the climate challenges," said chief executive Helge Lund.

He was speaking today, January 17th, at the Norwegian Petroleum Society's annual oil policy seminar in Sandefjord, south of Oslo.

Uniting climate measures with IOR would require the development of an efficient infrastructure able to handle large volumes of carbon dioxide.

Statoil will accordingly propose to its partners in Volve that studies be launched to assess carbon injection for IOR on the discovery.

Due to come on stream in the spring of 2007, Volve is estimated to contain 70 million barrels of oil and 1.5 billion cubic meters of gas.

Sleipner is a suitable site for storing carbon dioxide from Naturkraft's power station at Kårstø north of Stavanger until more concrete IOR possibilities have been established.

The first step in an IOR project could be to assess the use of carbon dioxide from the Sleipner fields, also operated by the group and located 10 kilometers from Volve.

"A solution of that kind could represent the initial stage in constructing a major carbon dioxide chain," Mr. Lund told the seminar.

"And it could perhaps form the basis for concrete industrial cooperation on carbon dioxide between the UK and Norway."

He emphasized that a unified carbon dioxide infrastructure presupposes a substantial financial commitment by the government.

In his speech, Mr. Lund also stressed Norway's key role as a stable and long-term energy supplier to Europe.

Statoil is working closely with Hydro and gas transport operator Gassco to plan further development of the Troll field, including gas yet to be exploited in its western section.

These reserves alone are on a par with the gas volumes in the Ormen Lange development being pursued by Hydro in the Norwegian Sea.

Statoil wants the remaining gas in Troll to be landed at the Kollsnes processing plant west of Bergen, with daily capacity at this facility and on Troll A raised by 40 million cubic meters.

That would open opportunities for laying a new export pipeline from Kollsnes, either to continental Europe or to the UK.

Statoil gives great weight to an acceptable gas offtake which can achieve optimum recovery of both gas and oil without consequences for oil production.

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