Norway awards 56 licenses to 36 companies in APA 2015

Norway’s Ministry of Petroleum and Energy has awarded 56 production licenses to 36 companies on the Norwegian continental shelf as part of its Awards in Predefined Areas (APA) 2015.

Of the 56 licenses covering 220,635 sq km, 27 are in the North Sea, 24 in the Norwegian Sea, and five in the Barents Sea. Fourteen of the licenses are additional acreage for existing production licenses. Five of the new licenses are divided stratigraphically and apply only to levels below or above a defined stratigraphic boundary.

Of the 43 companies that applied, 37 will be offered ownership interests in at least one production license, with 22 as operators. Norway’s state-owned Petoro AS will participate as a licensee and will manage the state’s direct financial interest (SDFI) in 13 production licenses.

Statoil with highest tallies

Statoil ASA took the most licenses, 24, of which 13 are as operator. Included are two prospects that the company sees as potential tie-back opportunities to existing infrastructure.

Potentially tied back to Goliat (OGJ Online, Apr. 28, 2015), the Blamann prospect in the Barents Sea will be operated by Statoil with 50% interest alongside Eni SPA 30% and Petoro 20%. Statoil has a firm well commitment to be drilled within 2 years of the award.

The Cape Vulture prospect, awarded as an extension of the Norne license (PL128) in the Norwegian Sea (OGJ Online, Jan. 9, 2015), will be operated by Statoil with 64% interest alongside Eni 11.5%, and Petoro 24.5%. The work program also comprises a firm well commitment to be fulfilled within 2 years of the award.

Det Norske Oljeselskap ASA was awarded the second-most licenses overall at 10, which includes the second-most operatorships at six.

Tullow Oil PLC took eight licenses with three operatorships, and Wintershall Holding GMBH took seven licenses including four operatorships.

Company obligations

The offers are subject to obligations stipulated by Norwegian authorities, including a requirement for acquisition of new seismic in four areas, and two firm wells must be drilled.

For the other production licenses there are “drill or drop” conditions, meaning the licensees have between 1-3 years to decide whether they want to drill an exploration well. If they do not wish to drill an exploration well, the production license lapses.

“The number of applications has remained fairly constant in recent years,” said Sissel Eriksen, director of exploration for the Norwegian Petroleum Directorate (NPD). “We are pleased that the oil companies still see the potential in the Norwegian shelf and are very focused on mature areas.

In APA 2014, Norway offered ownership interests in 54 production licenses (PL) to 43 companies out of a record 47 that applied (OGJ Online, Jan. 20, 2015). Statoil, Lundin Petroleum AB, and E.On E&P Norge AS were most active in that round.

“It is an advantage that the geology is relatively familiar, even though surprises cannot be ruled out,” Eriksen noted regarding APA 2015. “Many of these areas have existing fields that are nearing the end of production, with infrastructure that can be exploited. It is therefore important that we explore the surrounding areas so that potential resources are not lost.”

Separately, NPD last month reported that Norway’s 23rd licensing round received applications on 57 blocks or portions of blocks from 26 firms (OGJ Online, Dec. 4, 2015).

Those blocks lie in frontier areas where more exploration is needed to determine resource potential. Of the total, 3 are in the Norwegian Sea and 54 are in the Barents Sea.

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