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New oil development planned for Norway

German energy company Wintershall gets approval for offshore Maria oil field.

By Daniel J. Graeber
German energy company Wintershall is set to spend more offshore Norway, where the government sees economic pressure from low crude oil prices. Graph courtesy of Statistics Norway
German energy company Wintershall is set to spend more offshore Norway, where the government sees economic pressure from low crude oil prices. Graph courtesy of Statistics Norway

OSLO, Norway, Sept. 4 (UPI) -- German energy Wintershall said its development plans for the Maria oil field in the Norwegian Sea were approved by the government in Oslo.

"In a challenging oil price environment, we are moving ahead with the execution of this key development project," Hugo Dijkgraaf, the field's project director for Wintershall, said in a statement. "Through Maria we are investing in one of our core international regions which demonstrates our commitment on the Norwegian Continental Shelf."

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Wintershall in June sold its minority shares in four fields on the Norwegian shelf to Tellus Petroleum, which has headquarters in Oslo. Tellus, which said its strategic goal is to become a premier player offshore Norway, agreed to pay more than $600 million to acquire the assets from Wintershall.

Though low oil prices are expected to drag on revenues, Wintershall has said it plans to ramp up production from its core assets by 40 percent by 2018. The company said it plans to spend as much as $1.8 billion in development drilling in the Maria prospect.

The Norwegian government said its oil-driven economy has been pressured by lower crude oil prices, with overall investments expected to decline by 12 percent this year. Slow global growth leaves the government somewhat pessimistic, but an uptick is expected to emerge on the horizon.

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"We anticipate that the cyclical bottom is near, and that Norway's trading partners as a whole are heading into a new upturn next year," Statistics Norway said in a statement. "However, the recovery is not set to be strong, and we expect a very moderate growth increase in Norwegian export markets going forward."

Wintershall said Maria nonetheless is an important landmark project for Norway. Recoverable resources are estimated at 180 million barrels of oil, of which the majority is oil. Maria is expected to begin production by 2018.

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