Norway based energy company
) has set aside NOK 8.5 billion ($1.45 billion) to enhance recovery
in Gullfaks South field in the Norwegian North Sea.
Statoil, along with its partner Norwegian state owned firm Petoro
ASA, plans to set up two new subsea templates and drill six
additional wells - four oil producers and two gas injectors - at
the field. This forms part of its fast-track development and is
likely to increase output by 65 million barrels of oil equivalent
out of the mature reservoir.
Semi-submersible rigs - Deepsea Atlantic and Songa Dee - will be
used to drill new wells. These rigs are already operating in
Statoil-operated Production Licence 050.
Production in Gullfaks South takes place through a satellite
tie-back to the Gullfaks A platform. Certain parts of Gullfaks
South stopped production in 2008 to maintain reservoir pressure at
an acceptable level for future drilling operations.
In the course of 2012, the existing wells are being restarted.
Further, new holes are being spud utilizing already installed
subsea templates. These new holes will be tied back to the A
platform and drilled from existing seabed templates on Gullfaks
The project is scheduled to come online by 2014 and is likely to
extend the platform's production life beyond 2030. The development
will use unused processing capacity on Gullfaks A.
Earlier in 2012, Statoil had signed a NOK 900 million ($155
million) contract with a unit of
) - Framo Engineering, whereby the unit would design and build
subsea gas compression plants for the Gullfaks field. Subsea gas
compression would assist in raising production from the existing
fields on the Norwegian Continental Shelf as well as augment the
producing life cycle of the gas fields. This again has formed a
part of its fast-track program.
Statoil holds a Zacks #2 Rank which translates to a Buy rating for
a period of one to three months. Longer term, we maintain a Neutral
recommendation on the stock.
SCHLUMBERGER LT (SLB): Free Stock Analysis
STATOIL ASA-ADR (STO): Free Stock Analysis
To read this article on Zacks.com click here.