Statoil awards offshore FEED contracts

Norway

STAVANGER, March 21, 2017 – Norway’s Statoil on Tuesday confirmed cost estimates for the development of the Johan Sverdrup offshore field and awarded FEED contracts for phase 2 of the project to Siemens, Kværner and Aker Solutions.

Total investment in the field is now projected at NOK 137 billion-152 billion (USD 16.2 billion-18 billion), the company said in a statement. Statoil has managed to cut expenses for the second stage of the development by half, it added, after reducing capex for the first stage by 20% last year.

“The quality of phase 1 and the improvement work we have performed with our partners and suppliers for phase 2 has enhanced profitability,” Kjetel Digre, project director for Johan Sverdrup, said in a press release.

“The break-even price for the full-field development is now less than USD 25 per barrel and with an ambition of a world class recovery rate of 70%,” he added.

The Phase 1 development is about 40% complete, the statement continued, and it is projected to come on line in late 2019. Phase 2 is expected to start operations by 2022.

“The partners will now proceed with maturing Phase 2 for the investment decision and submission of the plan for development and operation (PDO) in the second half of 2018,” the statement added.