Statoil submits PDO for Snorre expansion project

12/21/2017

STAVANGER -- Statoil is today, on behalf of the Snorre Unit partners, submitting the plan for development and operation (PDO) of the Snorre expansion project to the authorities. At the same time, contracts worth up to NOK 9 billion will be awarded.

The investment will increase recovery from Snorre field by close to 200 MMbbl.

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Snorre expansion project. Image: Statoil.

“Snorre expansion has been a marginal project, and Statoil has worked closely with partners and suppliers to realize it. We have finally arrived at a good concept utilising existing infrastructure and reducing costs,” says Margareth Øvrum, executive V.P. for technology, projects and drilling.

“In 2017, we have benefited from a comprehensive improvement effort by Statoil and suppliers, and we have succeeded in realizing development plans for Njord, Bauge, Johan Castberg and now Snorre Expansion, leading to investments of NOK 90 billion on the Norwegian continental shelf (NCS) and important activity for the industry,” says Øvrum.

Snorre field is important in our effort of increasing long-term value creation and activity on the NCS. The life of Snorre A was originally expected to last until 2011–2014. Now, Snorre field is expected to produce beyond 2040.

“Long-term activity and value creation on the NCS is central in our strategy. Snorre Expansion is the largest improved oil recovery project (IOR) on the NCS, and provides valuable production and activity benefitting the company, partners and society. Investment costs slightly exceed NOK 19 billion, and the PDO involves a comprehensive subsea development, upgrading of the Snorre A installation, increased gas injection and gas import for injection,” says Arne Sigve Nylund, Statoil’s executive V.P. for development and production in Norway.

In addition to the PDO being submitted today, Statoil is also signing contracts for the subsea production system with TechnipFMC, fabrication and installation of the pipeline bundle system with Subsea 7, modification work on Snorre A with Aibel and a rig with Transocean. All contracts are subject to final approval of the PDO by Norwegian authorities.

“During the past years, Norwegian suppliers have demonstrated both a will and ability to change. Due to enhanced competitiveness, Norwegian industry plays a key role also in the Snorre Expansion project. We estimate that 80% of the investments will include companies in Norway. Competitiveness has a short shelf-life however, and it is vital that the improvement work continues with unabated strength,” says Øvrum.

Based on analyses from Agenda Kaupang, around 23,000 man-years will be carried out in Norway in the Snorre expansion project phase.

Snorre expansion plans to start production in 2021, and will be operated and maintained by the existing Snorre organization in Stavanger, while supplies will still be handled by Fjordbase in Florø.

Partners in Snorre field are: Statoil Petroleum AS (33.27%), Petoro AS (30%), ExxonMobil Exploration and Production Norway AS (17.44%), Idemitsu Petroleum Norge AS (9.6%), DEA Norge AS (8.57%) and Point Resources AS (1.1%).

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