Equinor (OSLO: EQNR) has started up Statfjord Ost, a 26-million-barrel tie-back in the Norwegian North Sea.
The tie-back is expected to extend the life of the Statfjord C platform through to 2040.
Equinor, the majority state-owned oil firm of Norway, said the value of the tieback equates to around NOK 20 billion (£1.4bn) at today’s oil price.
That compares to investment costs of NOK 3.5bn (£259.3m).
Production kicked off six months ahead of schedule, and expected to be within estimated costs despite a weakened Norwegian krone.
“This proves the importance of extending the life of mature fields and maximizing value creation from existing infrastructure on the Norwegian continental shelf (NCS),” said Calimma Salthe, Equinor’s senior vice president for Field Life eXtension (FLX).
Statfjord Ost includes two new wells, with three more to follow.
The oil recovery rate at the Equinor North Sea development is expected to rise from 58% to 63% due to the scheme, which sits three miles from Statfjord C.
Equinor is partnered with Petoro AS (30%), Vår Energi ASA (20.55%), Okea ASA (14.0%) *, INPEX Idemitsu Norge AS (4.8%), Wintershall Dea Norge AS (1.4%) on the project.
Ketil Rongved, Equinor’s vice president for FLX projects, said: “This is a good example of how we work with mature fields. Equinor aims to be a leading operator of late-life fields on the NCS. That means that we need to find new ways of working to reduce costs.
“Together with our partners we have developed simpler and faster solutions while maintaining high quality.”
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