Sept. 5 (UPI) -- Norwegian energy company Statoil said the coast to develop the first half of its mega Johan Sverdrup oil field went down by about 5 percent.
Johan Sverdrup is one of Norway's five largest offshore oil fields, and contains an estimated 3 billion barrels of oil. Phase 1 of the field's development is currently underway, with the first deliveries expected to begin in late 2019.
Statoil said improvements in delivery and execution for the first phase of development led to a 5.1 percent reduction in investment costs to around $11 billion.
"We are seeing high quality in project planning and execution across the entire project, and the project continues to benefit from good drilling and well efficiency, which together has enabled us to further reduce our forecast for the first phase," Eldar Sætre, the company's president and CEO, said in a statement.
At peak capacity, Johan Sverdrup should account for up to 25 percent of total Norwegian petroleum production. Contracts worth more than $5.7 billion have been awarded for the project so far and most of those have gone to companies in Norway.
Statoil added that the assembly of one of the four platforms for Johan Sverdrup development is underway at a port in Norway.
"In the second half of this project, the many elements of this giant project will be carefully pieced together," Margareth Øvrum, an executive vice president for technology, projects and drilling at Statoil, said. "It is a challenging phase in any project."
Statoil reported adjusted earnings for the second quarter of $3 billion, up from the $913 million reported in the same period last year. The company attributed the gains to strong operational performance, improved production and higher prices for oil and natural gas.