StatoilHydro to Recover Big Gains from Vega South

A few simple modifications to wells already planned will allow StatoilHydro to recover seven million barrels of oil and a billion standard cubic meters of associated gas from Vega South.

Located in the northern North Sea, this structure forms part of a project which also embraces the Vega North and Vega Central discoveries. Plans have called for these finds to be developed as a gas and condensate (light oil) field, but StatoilHydro will now also produce a thin layer of light crude from the southern discovery.

"This only calls for simple solutions and limited investment, while giving us a big gain," explained project manager Finn Langgard. Wells on Vega will be tied back to the Gjoa platform, which is due on stream next year.

Extra meters must be installed on the wellheads to permit recovery of the light crude. The total price tag for the project is about NOK 350 million. Since the light crude is not very different from the relatively fluid-rich gas/condensate, it has been possible to come up with a solution which uses the same wells.

Big Savings

"The two Vega South wells will be designed to handle the extra crude when they’re drilled this autumn," explains Tom Hasse Pedersen, venture manager for the Vega/Vega South oil projects.

"They're due to be completed next spring and summer, when conditions will be calmer. We expect to make big savings by doing this because waiting on weather for the rig will be reduced."

An application will be made to the authorities for exemption from the requirement to submit a revised plan for development and operation (PDO).

Plans call for Vega to come on stream through the Gjoa tie-in during the fourth quarter of next year at an estimated total cost of NOK 7 billion. Recoverable reserves in the field (excluding the oil zone) are put at 18 billion standard cubic meters of gas and 26 million barrels of condensate.

Vega South lies in production license 090C, where StatoilHydro is the operator with a 45% holding. The other licensees are Bayerngas with 25%, Idemitsu 15% and GDF Suez 15%.

Vega Central and Vega North lie in PL 248, again operated by StatoilHydro. The group has a 60% stake, with Petoro holding the remaining 40%.

Facts About Vega

The gas and condensate field Vega and Vega South are made up of the discoveries Vega North, Vega Central and Vega South (previously Camilla, Belinda and Fram B) in the northern part of the North Sea.

Vega (Vega North and Central) is located in block 35/8. Vega North is approximately 80 kilometers west of Floro in Sogn og Fjordane county. Vega South is located in block 35/11, approximately 10 km south of Vega Central, which is located approximately 10 km south of Vega North.

The ocean depth in this area is 370-380 meters, and Vega South is located approximately 10 kilometers northwest of the Fram fields and 45 kilometers northwest of the Troll field, between the Gjoa and Gullfaks fields.

The discoveries are divided between the licences PL248 Vega (Vega North and Vega Central) and PL090C Vega South.

Reserves/Production

Vega contains gas and condensate. The recoverable reserves are estimated to be 18 billion standard cubic meters of gas and 26 million barrels of condensate. At its height, production will be 7 million cubic meters of gas and 25,000 barrels of condensate per day.

The intention is to develop each discovery with two wells. The six wells will be drilled on the basis of the three seabed well templates -- one for each discovery. Each template will have well slots for up to four wells.

The start-up of the Vega field is scheduled for the fourth quarter 2010.