LYSAKER, Norway – Aker BP and its partners Equinor, Wintershall Dea, and PGNiG have taken the final investment decision (DG3) for Ærfugl Phase 2 in the Norwegian Sea.
Ærfugl is a two-phase subsea project. Both phases will tie into the Skarv FPSO, which is about 210 km (130 mi) west of Sandnessjøen.
The plan for development and operation for both phases of the Ærfugl development was submitted to the Ministry of Petroleum and Energy in December 2017.
Phase 1, which develops the southern part of the Ærfugl field, consists of three new wells. Phase 2 consists of an additional three wells in the northern part of the field. The original plan for start-up of Phase 2 was 2023, due to capacity restrictions for processing gas on the Skarv FPSO. Phase 2 is now expected to startup in the first half of 2020.
Ine Dolve, vice president Operations Skarv, said: “In parallel with development of Ærfugl Phase 1, work has been proceeding to increase gas processing capacity on Skarv. Modification of the plant will contribute to an increased capacity by more than 15%.”
According to Aker BP, the alliances in subsea installation, modifications, and drilling and wells have contributed to the Ærfugl project.
Bård Atle Hovd, project director for Skarv, said: “The Subsea alliance between Aker BP, Subsea 7 and Aker Solutions has demonstrated substantial improvements and increased value creation over several years. Now we see excellent deliveries from the alliances for the Ærfugl development.
“This fall, the Phase 1 production system, including three large subsea structures, was installed. The work has been done according to plan, without serious incidents. We are well-positioned to start production for Phase 1 in the fourth quarter of 2020.”
The Ærfugl reservoir is mainly a gas reservoir that extends more than 60 km (37 mi) and is 2-3 km (1.2-1.9 mi) wide. The project holds a total of around 300 MMboe.
Total investment costs for the Ærfugl project are about NOK 8 billion ($876 million). The total ‘life of field’ project has a break-even price of around $15/bbl (converted from gas).