Statfjord wells postponed

November 19, 1999, 08:00 CET

Two planned wells on the north flank of Statoil's Statfjord field in the North Sea have been postponed because the area contains less oil than expected.

The Statfjord north flank began producing crude from two wells in August, but project manager Kåre Søvik says this part of the reservoir has failed to meet expectations.

Recoverable reserves in the area were put at 75 million barrels of oil, but Statoil is currently preparing new estimates based on data from the two producing wells.

A decision on whether to drill further producers will probably be taken next summer.

The north flank is one of several small projects off Norway where reserves are being downgraded from earlier estimates.

Saga Petroleum's Varg field in the Sleipner area and the Visund field operated by Norsk Hydro in the northern North Sea are other examples.

Statoil is drawing the necessary lessons from the north flank, says Tor Fjæran, vice president for exploration and area development.

He notes that Norway's oil industry and offshore supplies sector have so far put great emphasis on reducing development costs and execution time.

"It's equally important to thoroughly investigate the earnings side and reserve base before a development is launched," he says.

As a case in point, Mr Fjæran points to Statoil's Kvitebjørn gas and condensate field. To reduce uncertainty about the size of this reservoir, Statoil recently carried out particularly detailed studies.

These led to a downgrading in estimated reserves, and the partners are now clarifying the profitability of a possible project on the basis of the new figures.