Low prices, high costs mar Troll development plan

Uchenna Izundu
OGJ International Editor

LONDON, Feb. 28 -- StatoilHydro has reworked its Troll development plan in light of falling oil prices and high costs as it delicately straddles improved oil recovery on Troll West against 120 million standard cu m/day of current gas export capacity from Troll East.

StatoilHydro has been concerned about high offshore services costs, stressing that the new oil environment was an opportunity to prioritize projects and drive down contractors' prices.

The company and its partners last June submitted to the Norwegian parliament its proposal, which is pending final approval. It outlines further development, installations, and operation of Troll field in the Norwegian North Sea where the companies anticipated spending 10 billion kroner. The new plan cuts this amount by 3.8 billion kroner because it would omit the replacement of flowlines in gas wells on the Troll A platform. However, this will be reconsidered at a later date, StatoilHydro said.

StatoilHydro's new plan will retain the gas injection system in Troll West as originally envisaged to improve oil recovery by 2010-11. Troll's oil reserves are expected to increase by 17 million bbl. The Troll oil production system, which is expected to remain in service until 2030, consists of more than 110 horizontal wells, several of which are multilateral.

High-precision horizontal drilling and production wells with up to six producing well bores have been developed in close collaboration with the company's drilling and well technology suppliers.

"A new pipeline for rich gas from the Troll A platform to Kollsnes gas processing plant, including modifications to Troll A and the Kollsnes receiving facility, will proceed as planned. This will help to secure the Troll field's position as a reliable, long-term source of supply for gas to Europe," said StatoilHydro (OGJ Online, Feb. 27, 2009). Troll is a major gas supplier to Europe.

Hege Marie Norheim, senior vice-president for StatoilHydro's reserve and business development on the Norwegian continental shelf added: "StatoilHydro will, as the operator of both Troll Gas and Troll Oil, make sure to take care of the long-term management of our largest oil and gas field in an optimal way."

Contact Uchenna Izundu at uchennai@pennwell.com.

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