Statoil Says `Good Deal’ of Work Needed to Restart Oil Fields Shut by Leak

Statoil ASA, Norway’s largest oil company, said a “good deal” of work remains before 205,000 barrels of daily oil output can restart at two North Sea fields, which were idled four days ago because of a leak.

“We can’t say when production will resume,” Kristofer Hetland, a spokesman at Stavanger, Norway-based Statoil, said in a telephone interview today. “There is still a good deal of work to be done.”
Statoil on Nov. 28 evacuated most of the 216 workers from the Snorre A platform after gas leaked from an underwater injection well, threatening to explode or topple the rig. The leak halted output from Snorre A and the nearby Vigdis platform, which is remotely controlled from Snorre A.

Work to secure the well, which injects gas into Snorre’s oil reservoir to increase pressure and boost output, is going ahead as planned, Hetland said. Fifty cubic meters of cement were pumped into the well early today to prevent gas from reaching the surface. More work is needed to secure the site, Hetland said.

“We are continuing the work to plug the well,’‘ said Hetland. “It’s going as planned.” Statoil became the operator of Snorre in January of last year.

Shares of the company fell for a second day after oil prices dropped 7 percent yesterday in London as a U.S. report showed heating fuel inventories rose last week. Statoil stock slid as much as 3.25 kroner, or 3.4 percent, to 92.25 kroner as of 12:30 p.m. in Oslo.

“Statoil is down today because of the huge drop in oil prices, and it isn’t helping that Snorre and Vigdis are closed,” Anne Gjoen, an analyst at Alfred Berg/ABN Amro in Oslo, said today in a telephone interview.

Crude Oil Slumps

Crude oil for January delivery fell 94 cents, or 2.2 percent, to $41.37 a barrel in London today. Prices rose as much as 1 percent in earlier trading. Norway is the world’s third-largest oil exporter, pumping about 2.8 million barrels a day.

Statoil holds 14 percent of the Snorre field and state-owned Petoro AS 30 percent. Norsk Hydro ASA, Norway’s second-largest oil company, owns 18 percent, Exxon Mobil Corp. 11 percent and Total SA 6 percent. Idemitsu Petroleum Norge, RWE AG, Amerada Hess and Royal Dutch/Shell Group also hold stakes.

Statoil holds 28 percent of Vigdis and Petoro 30 percent. Hydro owns 13 percent and Exxon 11 percent. Idemitsu, Total and RWE also have stakes in the field.

To contact the reporters on this story:
Bunny Nooryani in Oslo at bnooryani@bloomberg.net
Petter Narvestad in Oslo at pnarvestad@bloomberg.net

To contact the editor responsible for this story:
Tim Coulter at tcoulter@bloomberg.net

Last Updated: December 2, 2004 06:52 EST

Bloomberg