Realising the full potential from the Norwegian Continental Shelf
Today, Tuesday 16 June 2009, StatoilHydro is hosting a group of investors and analysts in Hammerfest – the northernmost city in the world.
The tour is showcasing Snøhvit LNG, the first Liquefied Natural Gas (LNG) plant in Northern Europe and the first offshore field development in the Barents Sea. “This frontier development demonstrates how StatoilHydro – through pioneering technological solutions – is realising the full potential from the Norwegian Continental Shelf (NCS),” says Øystein Michelsen, executive vice president, Exploration and Production Norway.
NCS production at 1.5 millon boe /d
“The NCS is an attractive petroleum province with significant resources in existing fields and a large yet to find potential. This resource potential, together with StatoilHydro’s unique experience and ability to develop the NCS, supports our ambition of maintaining production of around 1.5 million barrels of oil equivalent per day (boe/d) from the NCS over the next 10 years,” Mr Michelsen says. StatoilHydro’s NCS ambition is underpinned by a robust portfolio of sanctioned projects and identified non-sanctioned development projects. The company is also pursuing a promising set of Improved Oil Recovery (IOR) efforts that contribute to fighting decline in mature areas.
Growing the resource base
Exploration activity remains at a high level. So far in 2009 StatoilHydro has completed 24 wells and made 19 discoveries on the NCS, representing a success rate of close to 80%. “The 2008 resource account shows a growth in discovered resources to about 22 billion barrels of oil equivalent (boe). This represents 32 years of production at current level, “ says Chief Financial Officer Eldar Sætre. “Approximately 50% of the resources are on the NCS. This clearly supports our ambition to maintain NCS production at current level and grow our production outside Norway,” Mr Sætre underlines.
StatoilHydro’s equity production guiding for 2009 and 2012 remains firm at 1.95 million boe/d and 2.2 million boe/d respectively. StatoilHydro is on track with realising the merger synergies. As a result of continuous focus on driving operational improvements and increasing efficiency throughout the organisation, the estimate for annual merger synergies is raised from NOK 6 billion to NOK 7 billion. Further cost reductions for 2009 and 2010 are also being targeted.
The Snøhvit development is completely subsea and is connected to shore through the world’s longest multiphase pipeline. “StatoilHydro is a world-leader in innovative integrated subsea field development, subsea processing and long range multiphase transport of hydrocarbons. We are now in a unique position to leverage our experience towards future subsea and arctic developments,” says Margareth Øvrum, executive vice president, Technology and New Energy. “This experience coupled with a technology edge makes StatoilHydro able to extend current production and develop new production from fields that earlier were considered impossible. Through technological developments, we are redefining the limits of recoverable resources and continuously improving our recovery rates,” Mrs Øvrum says.