Extending Statfjord’s Life

Wednesday, April 08, 2009

The Statfjord late life project has prolonged this North Sea field's productive life beyond expectations. “We are highly satisfied with every single year we can add to the Statfjord field’s productive life,” said Ståle Tungesvik, senior vice president for the operations west cluster in the Exploration & Production Norway business area.

“During the late life project we have extended the production period at the Statfjord field beyond 2020. The planned field production period has been prolonged by 12 years, which is two years more than we expected when we submitted the plans for the Statfjord late life project.”

The work on extending the field’s productive life is carried out while the platforms are in operation.

“In order to succeed in this type of projects it is important to find a balance between optimizing the day-to-day production while at the same time executing projects and making investments that will give optimal use of resources in the long term,” said Mr Tungesvik.

“The overall value creation of the Statfjord late life project is estimated at around NOK 60 billion,” saif Mr Tungesvik. “This is a sixfold value increase since the project plan was submitted to the authorities in 2004. The cash flow from Statfjord in 2008 was sufficient to cover the entire late life investment, also including the Tampen Link pipeline.” Completed in 2007, the pipeline connects the Statfjord gas to the British market.

StatoilHydro and the partners have now decided to invest in eight new electrical submersible pumps on the Statfjord C platform. StatoilHydro and the partners are also evaluating to invest in additional four pumps for the Statfjord B platform.

The total investment for the submersible pumps on Statfjord B and C is in the range of $.5b, and is subject to approval by the partners.

Submersible pumps will be used for pumping water out of the reservoir, thus lowering the reservoir pressure and releasing more gas for production. The pumps will be installed in the wells at depths as low as 4,500 metres.

The total investment in the Statfjord late life project is estimated at around $3.4b, including the Tampen Link pipeline and the submersible pumps for Statfjord B and C. The investment estimate of the original development plan was $2.2b.

“So far, the Statfjord field has generated a gross income of as much as NOK 1,200 billion,” said Mr Tungesvik. “The Statfjord late life project is forming the basis for the Statfjord field to generate great value for StatoilHydro, the partners and society for many years to come.”

Partners: StatoilHydro (operator) (44.33688%), ExxonMobil (21.36717%), ConocoPhillips (10.32747%), ConocoPhillips UK (4.84377%), Norske Shell (8.54687%), Enterprise (0.89030%) and Centrica (9.6875%)

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