Norwegian oil major Statoil has decided to postpone the Bressay project development, located on the UK continental shelf, due to low oil price environment that is, according to Statoil, “likely to persist over the next one to two years”.
The Norwegian company became the operator of the Bressay field in 2007 and it holds 81.625% interest, while the remaining 18.375% interest is held by Shell.
After several media reports saying that Statoil is postponing the development of Bressay field, Offshore Energy Today reached out to the Norwegian company seeking confirmation of these reports.
In an e-mail to Offshore Energy Today, Statoil spokesperson said: “Statoil and partner Shell have for many years worked hard to find a profitable development solution for the challenging Bressay asset. We have made significant progress through innovative solutions, and achieved substantial improvements in the business case, compared to earlier development concepts.
“However, in the context of the price and market environment likely to persist over the next one to two years, these improvements are not sufficient to proceed with the project at this time. Statoil and partner Shell have therefore decided to halt the current concept selection process.”
Statoil is the operator of two fields on the UKCS, Bressay and Mariner, with Mariner set for first oil in the second half of 2018.
The spokesperson added: “Statoil remains strongly committed to the UK Continental Shelf. The Mariner field development continues, and we are actively pursuing opportunities to increase value creation from the Mariner area.”
The Bressay heavy oil field was first discovered in 1976, but a combination of technical and commercial challenges has resulted in the long period to mature the discovery to development.
The Bressay discovery stretches over four licences. One of them, P920, was due to expire in July 2014 and is now extended to December 2016.
Recoverable reserves in Bressay are estimated at 100-300 million barrels of oil.
Statoil recently dropped its previous platform solution plans for the Snorre 2040 development, in the Norwegian North Sea, deciding in favor of a subsea solution as a possible development concept. The company said that, through the work on the subsea solution, the level of costs had been significantly reduced.
Offshore Energy Today Staff