Statoil Ready with Johan Sverdrup Concept - Analyst Blog


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Norwegian oil giant Statoil ASA 's ( STO ) share price rose 1.2% on the announcement that it has finalized a concept for Johan Sverdrup's first development phase along with its partners. The development would include a field centre consisting of four installations and power from shore.

The partners' decision to source power from the shore is aimed at reducing total CO2 emissions from the Utsira High area by 60-70%. The field will receive an estimated projected 80 MW of power through a transformer on Karsto that will deliver direct current to the riser platform.

The field development will occur in multiple phases. The first phase is designed to yield 315,000 barrels of oil equivalents per day (Boe/d) with expected production between 315,000 Boe/d and 380,000 Boe/d in the early phase. Pre-drilling of wells will facilitate rapid acceleration in production. The water depth in the area is around 120 meters.

The partners' are constantly working on reducing the investment level for the first phase. The field centre in the initial phase has been designed so as to aid future development and includes a process platform, drilling platform, riser platform as well as living quarters.

The export solution for oil and gas from Johan Sverdrup is based on transport to shore through dedicated pipelines. The oil will be carried to the Mongstad terminal in Hordaland county. The gas will be transferred through Statpipe to Karsto in Rogaland county for processing and transport.

Located in the North Sea, 140 kilometers west from Stavanger, the Utsira High, is expected to receive approval for its plan for development and operation in 2015. The field is scheduled to come online by the end of 2019, and is anticipated to continue producing beyond 2050.

Statoil carries a Zacks Rank #3 (Hold). However, there are better-ranked stocks in the oil and gas sector such as Helmerich & Payne, Inc. ( HP ), Matrix Service Company ( MTRX ) and Cabot Oil & Gas Corporation ( COG ). All these hold a Zacks Rank #1 (Strong Buy).

CABOT OIL & GAS (COG): Free Stock Analysis Report

HELMERICH&PAYNE (HP): Free Stock Analysis Report

MATRIX SERVICE (MTRX): Free Stock Analysis Report

STATOIL ASA-ADR (STO): Free Stock Analysis Report

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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

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