Despite the low cycle that the market is facing, a total of 30 crude and natural gas projects are expected to start operations in the North Sea by 2020. The UK will lead with a total of 20 projects, followed by Norway with 9 and Denmark with a single project, according to research and consulting firm GlobalData.
The company’s latest report states that the North Sea has seen improvements during the downturn cycle witnessed over the last three to four years. Projects being sanctioned now have costs around half of those sanctioned in 2013, showing the companies have made clear improvements in cost efficiency. Operating costs have also halved from nearly US$30/bbl to just over US$15/bbl, while the production forecast has seen an increase from 2016 - a trend that is set to continue as new fields are brought on stream.
The total recoverable reserves for the 30 projects expected to start in the North Sea stand at 5.2 billion barrels of oil equivalent (boe). Statoil ASA holds the most reserves (1.6 billion boe), followed by Lundin Petroleum AB (635.9 million boe), Petoro AS (610 million boe), A.P. Moller Maersk A/S (414 million boe) and Aker BP ASA (381.2 million boe).
Luis Pereira, Upstream Analyst for GlobalData, explains: “Of the 30 upcoming North Sea projects, 21 are crude oil projects and nine are gas projects. Norway will dominate oil production, while the UK will dominate gas production. The key planned projects in the North Sea are expected to contribute around 690 000 bpd to global crude production and about 1255 million ft3/d to global gas production in 2020.”
The planned projects in the North Sea are expected to require a total capital expenditure (Capex) of US$71.1 billion, of which US$37.4 billion is expected to be spent between 2017 and 2020.
Norway will lead in terms of Capex, spending about US$19.3 billion during the forecast period, of which nearly US$13 billion will be spent on Johan Sverdrup. At the company level Statoil will have the highest Capex spending, and is expected to spend a total of US$19.1 billion on key planned projects through 2020.
According to Pereira, ten more fields are lined up to start production in the North Sea between 2021 and 2023. This will represent a further Capex investment of US$21.2 billion in the region, and will add 1.1 billion boe to the recoverable reserves.
Read the article online at: https://www.oilfieldtechnology.com/drilling-and-production/12042017/globaldata-north-sea-region-will-see-30-crude-and-natural-gas-projects-start-operations-by-2020/