Statoil to Plough in Over $642M in Askeladd Field Project

Statoil ASASTO recently announced its decision to invest more than NOK 5 billion or $642 million for development purposes of its Askeladd field, located in the Barents Sea. The produced gas and condensate will be provided from the Askeladd field development, the second phase of the multi-phased Snøhvit development, to the liquefied natural gas (LNG) plant at Melkøya in Hammerfest, one of the world's most energy-efficient LNG facilities.

Partners in the Field

Statoil is the operator of the Snøhvit development and has a stake of 36.79%. It has Petoro, TOTAL S.A. TOT , Neptune Energy Norge and DEA Norge as partners in the development owning 30%, 18.40%, 12% and 2.81% stakes, respectively.

About the Project

Two million cubic meters of condensate and 21 billion cubic meters of gas will be supplied from the Askeladd field to the Melkøya LNG plant. Production from the field is expected to begin by 2020-end. The development plan so far includes three wells through two new subsea templates. Enough space is there in the field so that more wells can be dug at the site later. The company is also expected to install an infrastructure that will link the Askeladd development, located south west of Snøhvit facility, to the existing Snøhvit infrastructure.

Importance of Askeladd

Statoil's senior vice president for project development, Torger Rød said, "Askeladd will help maintain a plateau production rate at the Hammerfest LNG plant until 2023 and is a profitable investment that will help secure jobs and ripple effects in the region." Moreover, the LNG plant needs profitable gas volumes in the coming years till 2050, which will be supported by the new development. In early 2018, Aker Solutions received an engineering, procurement and construction (EPC) contract for the Askeladd field. The Snøhvit development, Barents Sea's first petroleum development, already receives supply from the Snøhvit and Albatross fields, which came online in 2007.

About the Company

Statoil is a Norway-based major international integrated oil and gas company. The company has operations in all major hydrocarbon-producing regions of the world. It has an upstream focus on the Norwegian Continental Shelf. Due to strong offshore exposure, Statoil is a leader in subsea production. The company operates in four segments - Development and Production Norway, Development and Production International, Marketing, Midstream and Processing, as well as Other.

Price Performance

Statoil has gained 36.8% in the last year compared with 9.9% growth of its industry .

Zacks Rank and Other Stocks to Consider

Statoil sports a Zacks Rank #1 (Strong Buy).

Other top-ranked stocks in the oil and energy sector are ConocoPhillips COP and Pioneer Natural Resources Company PXD , both sporting a Zacks Rank #1 (Strong Buy). You can see the complete list of today's Zacks #1 Rank stocks here .

Houston, TX-based ConocoPhillips is an upstream energy player. Its revenues for first-quarter 2018 are anticipated to improve 9.6% from the prior-year quarter. The company witnessed a positive average earnings surprise of 144.5% in the trailing four quarters.

Irving, TX-based Pioneer Natural Resources is an independent oil and gas exploration and production company. Its revenues for first-quarter 2018 are expected to improve 22.8% from the year-ago quarter. For 2018, the bottom line is anticipated to be up 185.7%.

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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.

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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