Today, production of oil and gas started from the gigantic Johan Sverdrup field in the North Sea. This marks one of the most important milestones ever for the Norwegian oil and gas industry, and not least for Lundin Norway as co-owner of the field.
Johan Sverdrup is one of the largest fields ever discovered on the Norwegian shelf. And when operator Equinor opened up the valve on the first production well, this marked the start of production that is expected to last for 50 years.
“This is a fantastic day in so many ways,” says Managing Director in Lundin Norway, Kristin Færøvik.
“One of the largest industry projects ever in Norway has been completed with excellent results, and we have now started to harvest the enormous values that lie in these subsea hydrocarbons. This will benefit the owner companies in the Johan Sverdrup licence, but it will benefit the Norwegian society even more in the form of tax revenues and employment. Today, we are making history,” says Færøvik.
The Johan Sverdrup field is so large that it warrants development in multiple stages. The reservoir extends over more than 200 square kilometres, and estimates indicate that it contains 2.7 billion barrels of oil equivalents. The first development phase, which is now on stream, consists of a field centre with four platforms. The plan calls for daily production to reach a level of 440,000 barrels per day by summer next year.
After Phase 2 with a fifth platform is completed in 2022, daily production will jump to 660,000 barrels per day. That means that Johan Sverdrup will contribute one-quarter of Norway’s total oil production, all on its own.
“Johan Sverdrup is quite simply a fantastic story for Lundin. No more than 9 years have elapsed since our exploration department discovered the giant field, and now we can actually see a field centre producing offshore. That’s just about the fastest possible progress for such an enormous project,” says Kristin Færøvik.
“In fact, production is starting a month earlier than estimated and, even better, 40 billion kroner cheaper than first expected. Truly a modern-day oil fairy tale,” says Færøvik.
Lundin Norway is the second largest owner in the field with an ownership interest of 20%. The other licence partners are Equinor (operator), Petoro, AkerBP and Total.
“Johan Sverdrup will be a substantial boost for Lundin’s net production. Production from the field will be our most important source of income by far, for many years to come. This is a manifestation of the Company’s primary strategy of organic growth based on our own discoveries.”
“These revenues will also enable us to carry out a significant commitment on the Norwegian shelf in the years ahead. We feel certain that the Norwegian shelf still holds a lot to explore for, and plenty of resources that can and should be produced”, says Managing Director Kristin Færøvik.