Mixed results from new North Sea drilling

Data is being collected from a new appraisal well, but a frontier effort came up dry, the Norwegian government said.
By Daniel J. Graeber  |  Oct. 3, 2017 at 5:49 AM
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Oct. 3 (UPI) -- The Norwegian government said Tuesday it confirmed a discovery of oil and gas in the North Sea, but said efforts to find new reserves in untested waters failed.

The Norwegian government published data Tuesday from an appraisal well drilled by Aker BP, a merger of Norwegian energy companies and a subsidiary of BP, about 7 miles away from the producing Froy filed in the North Sea. The Norwegian Petroleum Directorate said the company ran through a column of oil measuring 44 feet and confirmed it as a discovery.

Before drilling, the company estimated the well held about 63 million barrels of recoverable oil and 70 million cubic feet of natural gas.

"Analyses are ongoing to confirm the resource estimate," the NPD said in a statement.

A separate wildcat well, one drilling into an area not previously known to hold reserves, was classified by the NPD as dry, with only "traces of petroleum." Recent efforts by drillers working in the Barents Sea had similar results.

Aker BP reported first quarter production of 145.3 million barrels of oil equivalent, an increase of 14.8 percent from the previous quarter. Most of the company's output came from the Alvheim license area, which draws oil using a floating production facility from four fields in the central North Sea.

The company said it expects to produce between 135 million barrels of oil equivalent and 140 million barrels of oil equivalent per day for all of 2017, an upward revision of about 5 percent. Full-year production costs were estimated at $10 per barrel of oil equivalent, a downward revision of about 9 percent.

Apart from Russia, Norway is one of the leading energy suppliers to the European economy, designating nearly all of its offshore production for exports. The NPD reported preliminary production figures for August were lower than expected.

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