New technology will reduce costs in the Barents Sea – Future Requirements

Under the Barents Sea Conference in Hammerfest Tuesday launched Statoil’s technology director Margaret Øvrum a new concept for drilling at shallow depths in the Barents Sea.

On some projects, costs can be reduced by up to 30 percent, the company claims. The new concept has been dubbed CapX and consists of both new and familiar technology.

– The advantage of the new design is that we can get easier and quicker out in horizontal drilling. That means we may have fewer wells and reach over wider areas, say Øvrum said.

Smaller footprint

Fewer wells means lower costs, but also that the imprint of the drilling activity is reduced. The new concept has been developed specifically for the Barents Sea where the resources are located in shallower seabed than other parts of the shelf.

It is in view of the upcoming awards in 23rd round Statoil has developed the concept.

– But the pilot project will be tried out elsewhere on the shelf. Our goal is to be a driving force for subsea technology on the Norwegian shelf together with our industry partners, says Øvrum.

Standardisation

The size of the subsea template is reduced to one quarter, and measures 22 x 22 meters. These standardized modules should be able to set out by ship, which also helps to make holes at shallow depths cheaper.

In Hammerfest she claimed that low oil prices are the best means to get oil prices up.

– current oil prices trigger us to keep costs down, said Øvrum to a packed conference hall.

Nearly half

She pointed to several examples where the limit of profitability in Statoil projects are pushed sharply. Johan Castberg field in the Barents Sea claimed two years ago an oil price of $ 80 a barrel to be profitable. Today claims Øvrum that the largest undeveloped oil discovery on the Norwegian continental shelf will be profitable with an oil price of 45 dollars a barrel.

– Anyone can see that costs must be reduced for that Johan Castberg should be developed. We had to down at a level that is close to the current oil price, says Øvrum.

Johan Castberg Statoil has seen a number of factors to bring up profitability.

– We have investigated whether we can drill wells easier. We have seen fewer wells to reach the same area. We have also seen a simpler floating production than what we started out with. The sum of this is that we are almost down to half the break-even price we operated with two years aside, she says.

(© NTB)