Johan Sverdrup partners near development decision

Offshore staff

STAVANGER, Norway – Statoil and its partners in the Johan Sverdrup field will take an investment decision on the development concept early next year.

“We need to make the final clarifications and give the individual companies the opportunity to make a proper consideration,” said Øivind Reinertsen, senior vice president for the Johan Sverdrup field.

Statoil has awarded Aker Solutions a framework contract to provide engineering services, procurement, and management assistance (EPma) for up to 10 years for the development.

This includes front-end engineering design (FEED) work, valued at $105 million, along with the first-phase EPma option.

According to Lundin Petroleum, once the final concept selection decision has been made a further announcement will follow on the development concept, including production capacity at plateau, estimated capital costs, and likely timing of the different development phases.

Statoil says the partners hope to gain approval for the plan for development and operation during the spring 2015 session of the Norwegian Parliament (Stortinget), allowing them to achieve first production at the end of 2019.

Johan Sverdrup, which is still undergoing appraisal, is currently estimated to hold resources of 1.8-2.9 Bboe. It could remain in production through 2050.

The field extends over licenses PL265, 501 and 502 on the Utsira High in the central Norwegian North Sea, 140 km (87 mi) west of Stavanger. Water depth is 110 m (361 ft), with a reservoir depth of 1,900 m (6,233 ft).

Early this year the partners agreed to develop the field in phases, with Phase 1 calling for establishment of a four-platform field center.

They have since recommended transporting the oil via a subsea pipeline to the Mongstad terminal in Hordaland, and to take the gas to the Statpipe subsea trunkline system, onward to the Kårstø processing plant in northern Rogaland.

Partner Det norske understands that the first phase investments could be in the $16.22-21 billion range, including contingencies and estimated future price escalation.

12/20/2013

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