Norway-based Statoil ASA (STO) received consent from The Ministry of Petroleum and Energy for the development and operation (PDO) of Stjerne and Vigdis North-East fields. Statoil, along with other licensees, is expected to invest around 5.3 billion Norwegian crowns ($948 million) for the development of a small oil and gas field in the North Sea.
A four-slot seabed template tied back to Snorre A will be used for the development of Vigdis North-East, located in the Tampen area of the Norwegian North Sea. A new pipeline will be used to carry oil and gas flowing through Vigdis North-East to an existing model on Vigdis B and then on subsequently to Snorre A.
Vigdis North-East is estimated to have recoverable reserves of 25 million barrels of oil equivalent (MMboe) and is expected to come online in 2012–2013. Statoil is the operator of the field with a 41.5% interest while Petoro, ExxonMobil Corporation (XOM), Idemitsu, Total S.A. (TOT) and RWE Dea Norge hold 30%, 10%, 9.6%, 5.6% and 2.8%, respectively.
The development of Stjerne, previously known as Katla, will also be done with a four-slot seabed template. While two wells will be under production, the rest will be used to maintain reservoir pressure by injecting water. Oil produced from the field will be transported to Oseberg South and the gas would be used to increase output from the Oseberg Omega North.
Stjerne has projected recoverable reserves of 45 MMboe. It is expected to commence production in 2013. Statoil, the operator, holds a 49.3% stake. The other licensees are Petoro with 33.6%, Total E&P Norge with 10%, ExxonMobil E&P Norway with 4.7% and ConocoPhillips Skandinavia, subsidiary of ConocoPhillips (COP), with 2.4%.
With this, Statoil has now secured the green signal for all of its four fast-track projects. The Hyme and Visund South plans were given permits in June 2011.
We believe the company is increasingly shifting its focus to the still-unexplored areas of the Norwegian Sea, and intends to recover around 4.2 billion barrels of oil equivalent in the coming years. This is reflected in the discoveries mentioned above which will likely enhance the company’s volumes going forward.
Statoil holds a Zacks #3 Rank, which is equivalent to a Hold rating for a period of one to three months. We maintain a Neutral rating on the stock for the long term.
CONOCOPHILLIPS (COP): Free Stock Analysis Report
STATOIL ASA-ADR (STO): Free Stock Analysis Report
TOTAL FINA SA (TOT): Free Stock Analysis Report
EXXON MOBIL CRP (XOM): Free Stock Analysis Report
Get all Zacks Research Reports and be alerted to fast-breaking buy and sell opportunities every trading day.
Be the first to comment