STAVANGER, Norway – Statoil has started production from the Gullfaks Rimfaksdalen project in the Norwegian North Sea. The operator said it was originally scheduled for a Christmas Eve (Dec. 24) start-up, but the field is now onstream at lower costs than planned.
The project delivered is more than NOK 1 billion ($1.2 billion) below the estimate of the plan for development and operation (PDO), reducing costs from NOK 4.8 billion ($5.7 billion) to around NOK 3.7 billion ($4.4 billion).
Torger Rød, senior vice president for project development in Statoil, said: “Over time we have focused on reducing costs and raising the profitability of our projects to ensure long-term activity and value creation on the Norwegian continental shelf (NCS). Based on a smart concept using standard solutions and existing infrastructure, Gullfaks Rimfaksdalen strongly proves that we are on the right track to succeed on this work.”
Arne Sigve Nylund, executive vice president for Development and Production Norway, said: “The volumes from Gullfaks Rimfaksdalen help us reach our ambition of maintaining production and a high activity level on the NCS beyond 2030. We have a well-developed infrastructure and we will keep realizing opportunities in theNorth Sea.”
The Gullfaks Rimfaksdalen development consists of a standard subsea template with two simple gas production wells, and possibilities for tie-in of two more wells. The well stream is connected to the existing pipeline leading to the Gullfaks A platform.
Gas and condensate are transported in existing pipelines to the processing plant at Kårstø north of Stavanger for processing, and from there the gas is exported to markets on the European continent.
Statoil submitted theplan for development and operation in 2014. Project director Heide Reme, speaking today at ONS, said the fall in costs was down to several factors. “Before the final investment decision [FID] we reduced the planned number of subsea templates from two to one and the well count from four to two.
“Also, the project team identified opportunities to re-use old pipelines for the tieback [to Gullfaks A], and reduced the originally planned level of topsides modifications.
“After the FID, most of the remaining changes were due to good cooperation between the team members and the contractors. FMC, for instance, delivered all the subsea equipment according to schedule, with no delays, while Technip did an excellent job with the marine campaign.”
The semisubmersibleDeepSea Atlantic drilled the two wells last year, one month faster than expected, Reme added, while the Songa D completed the wells this year as scheduled. In addition, the program was blessed by very good weather, she said, which resulted in less weather downtime than anticipated.
Nylund said another helpful factor in achieving accelerated production and lower capex was the downturn in the market. “This has acted as a wake-up call for the industry,” he claimed, “showing us that we had to improve our ways of working with our partners and the supply chain.
“I see Gullfaks Rimfaksdalen as a sign of the industry’s recovery, in terms of regaining our competitiveness on the Norwegian shelf. We’re seeing improvements among all parties and across the entire value chain – that’s a result of hard work and difficult decisions.
“Times to come will continue to be tough, but I think we are now on the right track. We’re still striving for further improvements…in competitiveness on the shelf, to ensure we continue to generate a ripple of activity.
“We still see both big and small opportunities on the Norwegian shelf and want to realize as much of that potential as possible. The key is to sustain the improvements.”
Nylund said Statoil has 30 projects in the near-sanction phase globally, and has reduced the breakeven costs from $70 to $41/bbl. At the same time, reserves from this portfolio have been improved by 12%.