Statoil: More time needed for Johan Castberg project
Partners in the Johan Castberg license—Statoil ASA, Eni SPA, and Petoro—have decided to “spend more time on making the final concept selection” for the Johan Castberg project.
Statoil and its PL532 partners earlier this year concluded the 2013-14 Johan Castberg field exploration program by making an oil and gas discovery in the Drivis prospect in the Barents Sea (OGJ Online, May 2, 2014). The find represented the second oil discovery in the field, but fell beneath Statoil’s volume expections.
“The companies will continue efforts to mature the technical development solution, updating the resource basis and reducing cost leading up to the summer of 2015,” said Arne Sigve Nylund, Statoil executive vice-president for development and production, Norway. “The partners will also further assess the financial basis for an oil terminal at Veidnes,” Nylund said.
The Johan Castberg project comprises the Statoil-operated Skrugard discovery, made in 2011, and the Havis discovery, made in 2012. The discoveries were a breakthrough for the Barents Sea as a new oil province, Statoil said. Proved volumes in Johan Castberg are estimated at 400-600 million bbl of oil.
As operator of the Johan Castberg license, Statoil said, it has carried out an “extensive exploration campaign” in order to prove additional resources that could make the field “sufficiently viable.” The 12-month exploration campaign comprised a total of five wells at multiple reservoir depths.
“Unfortunately, the exploration campaign has proven less new oil resources in the Castberg area than expected. In total, we have not proven enough resources in Castberg to make the field viable for supporting infrastructure, including a pipeline to shore and an onshore terminal on its own,” Nylund said.
Government support practices for this type of infrastructure also remain unclear.