Equinor explains cost hikes at two offshore Norway projects

Oct. 8, 2019
Costs have risen at four ongoing development projects offshore Norway, according to the state budget published by the country’s Ministry of Petroleum and Energy.

Offshore staff

STAVANGER, Norway – Costs have risen at four ongoing development projects offshore Norway, according to the state budget published by the country’s Ministry of Petroleum and Energy.

One of these is Martin Linge in the North Sea, originally operated by Total. Since the previous report to the state budget, costs have grown by an estimated NOK7.9 billion ($865 million).

Before Equinor became operator in March 2018, the project had already suffered significant delays and substantial cost overruns, the company commented.

Anders Opedal, executive vice president for technology, projects and drilling, said: “For Equinor, the most important thing is that we start up a safe platform.

Martin Linge is a complex project, and the scope of work has increased. This means increased costs and somewhat more time before we can start production.”

Start-up has now been pushed back to 3Q 2020. Currently more than 1,100 personnel are working at the field and onshore to prepare the platform for service.

“Hook-up and commissioning of Martin Linge is an enormous task, but both we and our suppliers are working diligently to complete our work,” Opedal added.

Another of the company’s projects – Njord Future in the Norwegian Sea – is also incurring higher costs, due to the scope of the upgrades on the Njord A semisubmersible platform and the Njord Bravo storage vessel.

These are needed to ensure the facilities can produce for another 20 years, and to accommodate new discoveries in the area.

Equinor estimates the cost increase at around NOK4.5 billion ($493 million).

10/08/2019

Courtesy Var Energi's "Interim Report Fourth quarter 2023" presentation
Courtesy Valeura Energy Inc. Corporate Overview (presentation), February 2024