Norway's Storting (parliament) has approved the Phillips Petroleum Co. Norway group's $3 billion redevelopment plan for giant Ekofisk oil and gas field in the Norwegian North Sea.
The plan, submitted by the group last March to provide continued long term operation of Ekofisk, was unanimously approved Nov. 9 by Storting.
"The Ekofisk II plan will lead to significantly reduced operating costs and allow maximum long term recovery of Ekofisk reserves," said Knut Am, Phillips Norway managing director.
Additional recoverable reserves in the production license after 2011 are estimated at more than 280 million bbl of oil equivalent.
In other North Sea action, Norway's Den norske stats oljeselskap AS said estimated cost for its Nome field development project may be reduced to less than 7 billion kroner ($1.06 billion) from original estimates of 9.8 billion kroner ($1.48 billion).
EKOFISK REDEVELOPMENT
The Phillips group's Ekofisk redevelopment plan features these key items:
- Norway will acquire a direct ownership share of 5% starting Jan. 1, 1999. The state also will pay 5% of redevelopment costs.
- Royalty on crude oil and natural gas liquids will end when redevelopment is complete. The tentative date for completion is late 1998.
- The production license is extended from 2011 through 2028.
- Operating licenses for pipelines owned by Norpipe as will be extended from -05 for the oil pipeline and 2007 for the gas pipeline through 2028.
- After 2005 for the oil pipeline and 2007 for the gas pipeline, equity shares will be 30% Phillips Norway group, 30% Statoil, and 40% Norwegian state. Current ownership is divided 50-50 between the Phillips Norway group and Statoil.
The Ekofisk II plan provides for construction of two new platforms-a wellhead platform to be completed in 1996 and a combined process/transportation platform to be completed in 1998-linked with the existing Ekofisk Complex.
The new facilities are expected to allow production of the field to the end of the revised license term of 2028.
Currently, about 560,000 b/d of oil are shipped through Ekofisk Complex to Teesside, England, and 2 bcfd of gas move by pipeline to Emden, Germany.
Ekofisk partners are Phillips Norway 39.96%, Norsk Fina AS 30%, Norsk Agip AS 13.04%, Elf Petroleum Norge AS 7.594%, Norsk Hydro AS 6.7%, Total Norge AS. 3.547%, Statoil 1%, Elf Rex Norge AS 0.855%, and Norminol AS 0.304%.
NORNE FIELD
Statoil Project Director Kjell Helle said Norne field is expected to go on stream July 1, 1997, 6 months earlier than planned. This depends on the government approving Statoil's development plan by Mar. 1, 1995.
Nome field was first off the back burner after Norwegian operators froze development plans last summer, complaining that Oslo's licensing terms were making many development prospects unviable (OGJ, Oct. 3, p. 30).
Norne's good economics were cited at the time. Helle revealed that Statoil believes Norne field will break even at an oil price as low as $7/bbl.
Statoil let a 1.1 billion kroner ($170 million) hull contract for the Norne production ship to Far East Levingston Shipyard in Singapore. Delivery is slated for July 1, 1996.
Subsea flow lines and marine operations will be handled by Ugland Coilexip, Stavanger. Pipelay work is scheduled for summer 1996 and spring 1997.
Copyright 1994 Oil & Gas Journal. All Rights Reserved.
Issue date: 11/21/94
