Norway's Den norske stats oljeselskap AS has taken the brakes off its Norne oil field development project in the Norwegian Sea frontier.
Statoil submitted a plan for development and operation (PDO) to Oslo's Ministry of Industry & Energy spelling out plans to tap the 440 million bbl field in Block 6608/10. The project had been placed on hold, along with other Norwegian field development plans, in the hope among operators that government would decide not to increase its share in production licenses at the expense of private partners.
Industry & Energy Minister Jens Stoltenberg announced Sept. 15 that government claims on many Norwegian licenses would be dropped.
However, Norne was one of six fields in which the government claim was to be applied. That sort of government action had helped place a damper on field development off Norway (OGJ, Sept. 26, p. 29).
Elsewhere off Northwest Europe:
- Esso Norge AS disclosed a 7,000 b/d oil discovery on Block 25/8 in the Norwegian North Sea. The well found pay a company official described as "a very good reservoir." Enterprise Oil Norge AS drilled the discovery with the Dyvi Stena semisubmersible under a farmout agreement to earn a 50% interest in Esso's license.
- Canadian Occidental Petroleum Ltd. struck an agreement with Lasmo North Sea plc to earn interests in Blocks 43/12a, 43/13b, 43/19a, 44/16, and 44/22c in the southern gas basin of the U.K. North Sea.
NORNE DEVELOPMENT
Statoil said it decided to proceed with Norne development because the field satisfies profit requirements despite Oslo's refusal to ease license conditions significantly.
A letter from Statoil accompanying its PDO submission said Norne license partners were disappointed with government's decision to maintain the sliding scale option to reduce partner's interests.
The letter said also Statoil believes government's refusal to remove sliding scale options on all licenses will reduce development on the Norwegian continental shelf.
Statoil pointed out that Storting (parliament) will make the final decision on the sliding scale. So Statoil has not given up hope for improved terms.
Development cost for Norne is officially quoted as 9.8 billion kroner ($1.3 billion). However, project engineers have said this figure may be reduced by 20-30%, judging by bids for a proposed floating production system (OGJ, May 23, p. 23).
Norne production is expected to plateau at 150,000 b/d of oil. Operating costs will be about 620 million kroner ($85 million)/year.
Next Norwegian PDO submissions for major developments are likely to be for Vigdis and Njord fields.
Vigdis operator Saga Petroleum AS hopes to submit a PDO by the end of this month. This will detail a subsea tieback to Snorre field to tap reserves estimated at 180 million bbl of oil and 70 bcf of gas.
Njord operator Norsk Hydro AS intends to invite bids this month for a floating production system for the field. Njord is estimated to hold reserves of 280 million bbl of oil and 1.6 tcf of gas.
Depending on the cost estimates submitted, said a company official, Norsk Hydro intends to judge field commerciality before submitting a PDO in February 1995.
ENTERPRISE STRIKE
Enterprise spudded its 25/8-5S discovery July 21 as the first of a three well program on the block. It was drilled to 3,395 m measured depth.
Enterprise tested a 31 m perforated zone in the Paleocene, gauging the 7,000 b/d sustained flow of 36 gravity oil through a 2 in. choke.
The company will drill an appraisal well next year.
Esso has drilled two discoveries on the block, neither of which is on production. Esso's Balder prospect, 28 km south of the Enterprise strike, is being evaluated for development.
The Esso official said that, on an excitement scale of 1-10, the new find is rated between 5 and 10 by the company.
CANOXY-LASMO DEAL
Blocks involved in CanOxy's agreement with Lasmo hold the undeveloped Cavendish gas field as well as a number of other discoveries and exploration prospects.
Under terms of the agreement, CanOxy will pay Lasmo's share of four wells to earn working interests of 20-30% in the blocks. Lasmo's working interest in the blocks currently ranges from 40% to 80%. Drilling of the first well is expected to get under way in 1995.
Cavendish field, discovered in 1989, contains gas in upper Carboniferous sandstones. Three wells have drilled into the structure, with several zones yielding as much as 22 MMcfd from each well.
A major 3D seismic survey covering four of the involved blocks is nearly complete.
CanOxy was a successful applicant with Lasmo in the U.K.'s recent 15th offshore licensing round. The combine, operated by Lasmo, was awarded Blocks 44/19b, 44/22c, 44/28c, and 49/3 in the southern gas basin. CanOxy owns a 50% working interest in each block.
