Statoil: Troll Gas to Play Key Role in New Gas Export Pipe
OSLO, Nov 21, 2006 (Dow Jones Newswires)
Statoil's (STL.OS) ambitions at the Troll gas field on the Norwegian continental shelf will facilitate the development of nearby reserves and a new export pipe to the U.K. or Europe, the company said Tuesday.
Speaking at a Statoil-hosted conference in Oslo, the company's executive vice president for natural gas, Rune Bjornson said: "The Troll field needs to be developed further not just to increase (its) production," but to help promote the development of smaller fields in the Halten Nordland area.
"Our aim is to (develop) a new export pipeline to the U.K. or the continent, and to then put in place the development of additional fields further north," Bjornson said.
A new gas export pipe from Norway is widely expected to run from the Kollsnes gas processing plant where Troll gas volumes are processed before export, to either the U.K. or continental Europe.
"Many of the smaller fields in the Halten Nordland area are not big enough" to justify infrastructure developments in their own right, Bjornson added.
Statoil plans to double its worldwide gas volumes to 50 billion cubic meters a year by 2015, mainly through expanded output on the Norwegian continental shelf. A vast majority of these volumes will be exported to Europe via new and existing pipelines, helping ease recent European gas market volatility.
Bjornson said he expected the extreme volatility of the past couple of years to ease significantly, but added that "a balance" between secure supplies, the environment and retention of competitive prices must be sought to mitigate against negative impacts.
"In future (I) believe we will still have volatile markets, and at the same time energy has become more important on the agenda," he said, citing uncertainty over the role of global liquefied natural gas in Europe, and falling indigenous production in parts of Europe.
He said piped gas from Norway had a role to play in creating a gas balance, together with "important" Russian supplies, North African, Middle Eastern and Caspian Sea gas "which ought to improve security of supply to Europe."
Statoil's challenge "is to create a strategy of making value in a broken up picture," Bjornson concluded.
Statoil and Norsk Hydro (NHY.OS), operators of the Troll assets are currently discussing the most effective timing and way of developing the Troll resources to maximize both oil and gas production.
The Troll further development project will aim to establish how quickly gas in Troll West can be produced for export rather than reinjection to maintain reservoir pressure, without negatively impacting oil exports.
Troll East, which currently produces gas for export, and Troll West have around 1.3 trillion cubic meters of total gas reserves - a little less than at the giant Ormen Lange field which comes onstream next year, meaning the careful development of resources will be crucial.
Copyright (c) 2006 Dow Jones & Company, Inc.
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