Investing in 25 more years on the Snorre field

December 21, 2017 07:20 CET | Last modified December 21, 2017 12:25 CET

Statoil is today, on behalf of the Snorre Unit partners, submitting the plan for development and operation (PDO) of the Snorre Expansion Project to the authorities. At the same time, contracts worth up to NOK 9 billion will be awarded.

The investment will increase recovery from the Snorre field by close to 200 million barrels.

“Snorre Expansion has been a marginal project, and Statoil has worked closely with partners and suppliers to realise it. We have finally arrived at a good concept utilising existing infrastructure and reducing costs,” says Margareth Øvrum, executive vice president for Technology, Projects and Drilling.

“In 2017, we have benefitted from a comprehensive improvement effort by Statoil and suppliers, and we have succeeded in realising development plans for Njord, Bauge, Johan Castberg and now Snorre Expansion, leading to investments of NOK 90 billion on the Norwegian continental shelf (NCS) and important activity for the industry,” says Øvrum.

The Snorre field is important in our effort of increasing long-term value creation and activity on the NCS. The life of Snorre A was originally expected to last until 2011–2014. Now the Snorre field is expected to produce beyond 2040.

“Long-term activity and value creation on the NCS is central in our strategy. Snorre Expansion is the largest improved oil recovery project (IOR) on the NCS, and provides valuable production and activity benefitting the company, partners and society. Investment costs slightly exceed NOK 19 billion, and the PDO involves a comprehensive subsea development, upgrading of the Snorre A installation, increased gas injection and gas import for injection,” says Arne Sigve Nylund, Statoil’s executive vice president for Development and Production Norway.

In addition to the PDO being submitted today, Statoil is also signing contracts for the subsea production system with TechnipFMC, fabrication and installation of the pipeline bundle system with Subsea 7, modification work on Snorre A with Aibel and a rig with Transocean. All contracts are subject to final approval of the PDO by Norwegian authorities.

Margareth Øvrum, executive vice president for Technology, Projects and Drilling.
(Photo: Ole Jørgen Bratland)
Arne Sigve Nylund, Statoil’s executive vice president for Development and Production Norway.
(Photo: Harald Pettersen)
Margareth Øvrum, executive vice president for Technology, Projects and Drilling, submitted the PDO to Terje Søviknes, minister of Petroleum and Energy. (Photo: Arne Reidar Mortensen)

“During the past years, Norwegian suppliers have demonstrated both a will and ability to change. Due to enhanced competitiveness, Norwegian industry plays a key role also in the Snorre Expansion project. We estimate that 80 percent of the investments will include companies in Norway.  Competitiveness has a short shelf-life however, and it is vital that the improvement work continues with unabated strength,” says Øvrum.

Based on analyses from Agenda Kaupang, around 23,000 man-years will be carried out in Norway in the Snorre Expansion Project phase.

Snorre Expansion plans to start production in 2021, and will be operated and maintained by the existing Snorre organisation in Stavanger, while supplies will still be handled by Fjordbase in Florø.

Partners in the Snorre field are: Statoil Petroleum AS (33.27%), Petoro AS (30%), ExxonMobil Exploration and Production Norway AS (17.44%), Idemitsu Petroleum Norge AS (9.6%), DEA Norge AS (8.57%) and Point Resources AS (1.1%).

Press conference at 10:00 CET

The press will be invited to a press conference for the Snorre Expansion PDO submittal and for signing of contracts at Statoil’s offices at Forus West at 10:00 CET.

If you have any questions or would like to register for the press conference, please contact: Eskil Eriksen, mobile: 95 88 25 34, email: eseri@statoil.com

Major spin-offs for Norwegian supplier industry

  • Statoil has submitted four plans for development and operation in 2017: Njord and Bauge in the Norwegian Sea, Johan Castberg in the Barents Sea and now Snorre Expansion Project in the North Sea.
  • Total investment costs are around NOK 90 billion

Facts - plan

  • 24 new wells, 12 for production and 12 for injection
  • A total of six new subsea templates for production and alternating water/gas injection
  • Pipelines and umbilicals between the subsea templates and Snorre A
  • Upgrading of Snorre A for reception of production from the subsea templates and for supplying injection water and gas to the subsea templates

Facts - field

  • The Snorre field was discovered in 1979 and production started in 1992
  • Snorre is a giant in the North Sea, and one of the fields with the largest remaining reserves in Statoil’s portfolio of oil producing fields on the Norwegian continental shelf
  • Expected production when PDO was submitted was 750 million barrels of oil. So far, the Snorre field has produced 1.4 billion barrels of oil
  • Planned field recovery rate is currently 46 percent. The rate is expected to rise to 51 percent following the Snorre Expansion Project
  • The field is located in the Tampen area in the northern part of the North Sea
  • Water depth is 300 – 380 metres
  • Snorre field life was originally expected to last until 2011–2014. It is now expected to produce beyond 2040

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