Var Energi Makes FID on Balder Phase V in North Sea

Vår Energi ASA and license partner Kistos Energy Norway AS have reached the final investment decision for the Balder Phase V project in the North Sea’s Balder area.

The project aims to develop 33 million barrels of oil equivalent (MMboe) of gross proved plus probable (2P) reserves for a capital expenditure of approximately $690 million gross and with a breakeven price of around $USD per barrel, Var Energi said in a news release.

Balder Phase V involves drilling of up to six infill wells using all the remaining available template well slots in the existing Balder subsea facilities and tied back to the Jotun floating production, storage, and offloading (FPSO) for processing. The drilling of multilateral wells has resulted in extending the reservoir area, an increase in the recoverable reserves and recovery factor, and reducing the number of wells required, Var Energi said.

Drilling will begin in the first half of 2025 and be completed in 2026, with the first wells coming onstream by the end of 2025. 

The fast-track development will be “a key contributor to sustaining long-term production and value creation beyond 2025,” the company remarked.

With ongoing development projects coming on stream over the next three quarters, Vår Energi said it is on track to reach daily production levels of around 400 thousand barrels of oil equivalent per day (boepd) by the end of 2025. The company aims to sustain production long term through developing over 20 early-phase projects. Balder Phase V is the first of these projects to be sanctioned and the company expects multiple further project sanctions during 2025, it noted.

Var Energi COO Torger Rød said, “The Balder area in the North Sea is one of Vår Energi’s core hubs and constitutes significant future resource potential. With the refurbished Jotun FPSO on track to commence production from the field within Q2 2025 we have the tools to unlock additional production. The sanctioning of Balder Phase V aligns with our strategy of maximizing value in our core hub areas by utilizing existing capacity and infrastructure. I am very pleased to see how the upgraded FPSO will contribute to amplifying value creation from the area with such immediate effect. Beyond Balder Phase V, we are also maturing a Balder Phase VI project ensuring further long-term value creation in the area”.

“The use of advanced multilateral well technology enables targeting high value barrels, with a low breakeven, high rate of return and short time to market, showcasing our value driven approach to applying technology,” Rød added.

The field is operated by Var Energi with a 90 percent stake, with Kistos Energy Norway owning 10 percent.

In August, Var Energi announced the postponement of the production start date of its Balder X development project in the North Sea to the second quarter of 2025, instead of the fourth quarter of this year.

“Together with our suppliers we have made every effort to complete the final work on the Jotun FPSO [floating production, storage and offloading unit] at the Rosenberg yard to enable field installation before the winter weather period,” Var Energi said in an earlier statement.

“However, despite recent good progress, some onshore completion and commissioning work required prior to sail-away remains,” it continued.

According to the company’s website, the Balder X project enables further development in the Balder and Ringhorne area and consists of two sub-projects. The Balder Future project consists of the refurbishment and relocation of Jotun FPSO from the Jotun field to the Balder area to accommodate tie-ins of 14 new production wells and one new water injection well, with future expansion capacity to accommodate tie-ins in the area. The project will extend the technical lifetime of the Jotun FPSO beyond 2045.

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