Norwegian frontier survey indicates strong prospectivity

Offshore staff

OSLO -- The Norwegian Petroleum Directorate (NPD) has submitted its findings on newly acquired seismic over Norway’s frontier regions.

Norway’s parliament (Storting) commissioned NPD to perform this work during the summers of 2007, 2008, and 2009, the aim being to increase knowledge of geology and potential petroleum resources in areas historically off-limits to exploration.

NPD’s program involved acquired 2D and 3D seismic over areas off Lofoten, Vesteraalen, and Senja (Nordland VI and Troms II). Timing of the program was designed to cause minimal interference to fishing industry operations.

Based on the new knowledge and existing data, the NPD has mapped these areas and estimated their resource potential. Its evaluation also covers Vestfjorden, the unopened part of Nordland V, Nordland VI, and the Eggakanten area in the southwest of the Barents Sea.

The main conclusions are that Nordland VI appears the most prospective region, while the combined resource estimate for Nordland VII and Troms II is equivalent to that for Nordland VI. Also, both Nordland appear to be more prospective for oil, with gas likelier to be found in Troms II.

NPD says the continental shelf and declivity off the coast of Nordland and Troms counties comprises varied and complex geology. NPD has mapped a total of 50 prospects in Nordland VI, VII, and Troms II. Based on an analysis of play models, it puts recoverable oil and gas resources at around 202 MMcmoe, or about 1.3 Bbbl. However, there is a probable range of uncertainty in this estimate of 76-372 MMcmoe.

Taking into account technical and financial assumptions, NPD predicts a future net value of around NOK 500 billion ($85 billion). Over time, it adds, the uncertainty over undiscovered resources could be reduced through staged exploration, including drilling of exploration wells.

4/16/2010