Cost reserve cut on Åsgard

September 22, 2000, 18:30 CEST

The cost of Statoil's Åsgard development has risen by NOK 630 million, cutting into the exposure reserve included in the most recent estimate.

Although this reserve has been reduced from NOK 848 million to NOK 218 million, the various sub-projects are still within the overall framework of NOK 65,675 million.

Field development costs are up by NOK 530 million, reports project director Bård Heimset. Roughly half this amount can be attributed to Norway's two offshore strikes in the summer.

The other half has been incurred because remaining work is taking longer to complete and is wider in scope than forecast.

Drilling and well completion account for NOK 165 million of the extra NOK 530 million, primarily because a new gas producer was needed on Midgard after the original borehole collapsed.

The cost of Åsgard's gas receiving facilities at Statoil's Kårstø complex north of Stavanger has risen by NOK 100 million as a result of additional completion and start-up work.

Completion activities on the Åsgard B gas floater are on course for production to start on the contractual date of 1 October, reports project manager Finn Reierth.

Although part of the remaining work is time- and weather-critical, opening the first wells on the scheduled date currrently looks feasible, he says.

Åsgard gas will start arriving at Kårstø a couple of days latter.

"October will be devoted to making final adjustments to the platform, but we expect it to be up to the planned volume and regularity towards the end of the month," says Mr Reierth.

Statoil has concluded agreements on additional gas deliveries from Troll and Oseberg until 31 December to ensure that customers receive the agreed volume of gas at the contractual time.