Maersk Oil announces largest project investment ever made in the Danish North Sea
COPENHAGEN -- Maersk Oil is pleased to announce that the Danish Underground Consortium (DUC) has approved an investment of approximately DKK 21 billion in the full redevelopment of Tyra gas field. The announcement follows the Danish Parliament’s approval to implement legislation to secure the investment.
The redevelopment of Tyra ensures continued production from Denmark’s largest gas field, and will protect and rejuvenate important Danish North Sea infrastructure.
Today’s announcement represents the largest oil and gas project investment ever made in the Danish North Sea, enabling Tyra to continue operations for at least 25 years. At peak production, the redeveloped Tyra gas field will provide enough gas to supply 1.5 million Danish homes, supporting energy security, future tax revenues and employment for Denmark.
The investment cost for the modification to existing facilities and construction of new facilities (CAPEX) is estimated at approximately DKK 17 billion, and the cost in relation to removal and decommissioning of current facilities (ABEX) is estimated at approximately DKK 4 billion.
Extending the life of the Danish North Sea
Tyra is the centre of Denmark’s national energy infrastructure, processing 90% of the nation’s gas production. Through new development projects and third party tie-ins, the redevelopment of Tyra can be a catalyst for extending the life of the Danish North Sea – not just for Maersk Oil and the DUC, but also for Denmark.
The new infrastructure can enable operators to pursue new gas projects in the northern part of the North Sea, where the most recent development, Tyra Southeast, delivered first gas in 2015 and is producing above expectations.
The redeveloped Tyra is expected to deliver approximately 60.000 boed at peak, and it is estimated that the redevelopment can enable the production of more than 200 MMboe. Approximately 2/3 of the production is expected to be gas and 1/3 to be oil.
Alongside the Maersk Oil-operated Culzean development in the UK North Sea, the Tyra gas field redevelopment increases Maersk Oil’s exposure to natural gas production; an important bridging fuel for the energy transition.
Maersk Oil CEO, Gretchen Watkins, said: “Tyra has been a key asset in the history of Maersk Oil, and an important source of energy security for Denmark. The redevelopment of Tyra is the largest investment carried out in the Danish North Sea, and when completed in 2022, production from the Tyra field itself has the potential to cover Danish gas consumption for a decade.”
Protecting shared interests
The redevelopment of Tyra is enabled by the legislation, implemented by the Danish Parliament Nov. 28-30, 2017.
The Danish Minister for Energy, Utilities and Climate, Lars Chr. Lilleholt (V), said: “I am pleased that the DUC partners have made the final decision for this investment. The full reconstruction of Tyra is vital to the development of the Danish North Sea oil and gas sector. Not just to Maersk Oil – but to many companies relying on Tyra as a central gas hub.”
Maersk Oil’s Chief Operating Officer, Martin Rune Pedersen, said: “The redevelopment of Tyra is evidence of a shared interest in prolonging the life of the Danish North Sea. The investment in this globally significant oil and gas project will support several thousand Danish jobs, and it can enable future significant industry investments in new development projects made possible by the redeveloped Tyra gas infrastructure.”
Tyra field will be shut-in for the redevelopment in November 2019, and production is expected to recommmence in July 2022.
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