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North Sea oil and gas find bigger than expected

The Norwegian government reported results Thursday from an appraisal well in the North Sea that were better than operator Equinor expected.

The Norwegian Petroleum Directorate, the nation's energy regulator, reported that Equinor has finished drilling an appraisal well at its Sigrun oil and gas discovery just south of the producing Gudrun field in the Norwegian waters of the North Sea.

Equinor before the results were in put the estimated reserve potential at between 1.8 million and 8.8 million barrels of recoverable oil equivalent. The NPD estimate from the results was between 6.9 million and 12.5 million barrels of recoverable oil equivalent.

The results are important for a Norwegian government fretting over recent declines in offshore production. Apart from Russia, Norway is also one of the main exporters of oil and natural gas to the European economy.

For July, the NPD reported total oil production averaged 1.53 million barrels per day, about 2.7 percent below forecast. Total natural gas production, however, was 6 percent higher than forecast, putting total production above government forecasts by 2.2 percent.

Both oil and gas production averages for July were higher than the previous month, but lower year-on-year.

The Norwegian government earlier this year called for all hands on deck to keep production levels elevated.

Offshore trends are accelerating, however, and the NPD said it expected at least 40 exploration wells this year, compared with about 36 last year. Much of the focus, the regulator said, has been in the North and Norwegian Seas where drilling infrastructure is already in place.

On Wednesday, offshore services company Archer said it had enough work contracted in Norwegian waters to increase headcounts by 2,000 by the end of the year.

Equinor, which awarded most of the Archer contracts supporting the hiring spree, now moves its rig to another part of the North Sea to drill a wildcat well, one drilled in an area not previously known to hold reserves.

Published: 16-08-2018

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