Statoil Forecasts New North Sea Oil Bonanza

 

Norway’s Statoil AS A said on Monday that the giant Johan Sverdrup oil field in the North Sea could generate revenue of 1.35 trillion Norwegian kroner ($204.55 billion) over the next five decades.

The Norwegian oil producer said the oil field could produce up to 650,000 barrels of oil a day at its peak.

“According to a provisional estimate, total production revenues over 50 years may amount to as much as 1,350 billion kroner,” said Statoil.

Out of this, the Norwegian government would take 670 kroner billion in corporation taxes alone, Statoil said.

Norway has saved much of its oil and gas revenues in a sovereign-wealth fund, the world’s biggest, currently valued at around $840 billion. Statoil is 67% owned by the government.

“This will be a gigantic project that will secure energy supply and jobs and result in substantial spin offs and value for Norwegian society, the industry and the partnership behind the development,” said Arne Sigve Nylund, a Statoil executive vice president.

The Johan Sverdrup field, estimated to hold about 1.8 billion barrels of oil, will produce between 315,000 barrels a day and 380,000 barrels a day in the first phase, and could produce between 550,000 barrels a day and 650,000 barrels a day in later development stages.

Statoil expects to spend 170 billion kroner to 220 billion kroner to fully develop the project.

wsj.com