Johan Sverdrup to start up in October
STAVANGER, Norway – Equinor and its partners Lundin Norway, Petoro, Aker BP, and Total are accelerating the production start-up of the Johan Sverdrup field to October 2019, one month ahead of schedule.
Located on the Utsira High in the North Sea, 160 km (99 mi) west of Stavanger, the Johan Sverdrup development continues to progress well through the final stages of preparation for operations.
According to operator Equinor, since the plan for development and operation for Phase 1 of the Johan Sverdrup project was submitted in 2015, the project has seen both a significant cost reduction as well as an acceleration in the start-up schedule from late December 2019 to now October.
Anders Opedal, executive vice president for Technology, projects & drilling in Equinor, said: “Around this time last year, we accelerated the expected schedule for production start-up of Johan Sverdrup to November 2019. Now, as we enter the final stretch of the project, we believe it is possible to start production up to one month earlier.
“Being in the position to potentially accelerate first oil for a mega-project like this, demonstrates the high quality of execution in the Johan Sverdrup development. This is to a large extent due to the close collaboration with our partners and suppliers since day one in the project.”
The current focus of the Johan Sverdrup project is on completing the testing of the equipment and systems needed for the full field center – spanning four platforms and three interconnected bridges and associated modules – to function and perform as one installation.
Assuming all testing can be completed without encountering any issues with critical equipment, start-up of production is expected be ready to commence next month.
“Based on the remaining known scope of work, we are increasingly confident of starting production at Johan Sverdrup soon. At the same time, given the very size of the Johan Sverdrup development, there will always be a risk that we in the final testing phase come across unforeseen issues that end up extending the start-up period,” said Opedal. “Ultimately, we’ll only start producing when it is safe and prudent to do so.”
Plateau production is expected to reach 440,000 b/d of oil in the summer of 2020 at which point Equinor expects operating costs to be less than $2/bbl. The operator also expects cash flow from operations of around $50/bbl in 2020, based on a real oil price of $70/bbl, partly as a result of the phasing of tax payments in the ramp-up phase.
Phase 2, due to start up in 4Q 2022, will increase oil production through the field center to 660,000 b/d, with estimated capex of NOK41 billion ($4.7 billion).