Much to be done
Coordinated solutions, adoption of new technology and exchange of experience between players will help to increase value for new projects on fields and discoveries.
Execute projects on the fields
(Photo: Statoil/Harald Pettersen)
Photo: Johan Castberg (Statoil/Kåre Spanne)
Implement new technology
Learn from each other
Players in the petroleum industry have done good work over many years in proving resources and finding solutions which ensure that the resources can be produced.
Drilling production wells
The most important way of securing output from a field is to drill production wells. Testing and adopting new drilling and well technology can help to grow reserves by making more challenging targets accessible.
Coordination and area solutions
Most discoveries are developed with seabed installations tied back to existing facilities. In this way, good collaboration across production licences can reduce overall development costs in an area while also making it possible to improve recovery from the host Field
Projects on fields create significant value
Recoverable resources in projects on fields are estimated to total 845 million scm oe. Many projects are planned and implemented on fields which will yield a substantial growth in reserves. Continuously identifying and maturing projects is important for maintaining value creation.
Big opportunities in discoveries
The Norwegian continental shelf (NCS) had 77 discoveries with estimated recoverable resources totalling 697.5 million scm oe at 31 December 2016. A number of these are relatively small, and therefore depend on existing fields or coordinated solutions to be brought on stream. The companies have worked well in recent years to improve their development plans and concepts.
Develop and adopt new technology
The NCS has been a laboratory for developing new technology from the start. Unfortunately, many good ideas fail to get beyond laboratory testing. As fields age, further work on cost-effective solutions which make it possible to recover remaining resources is becoming a matter of urgency. Developing new drilling and well technology represents an important measure which should be given priority.
More players on the NCS
Large companies dominated activity on the NCS until the turn of the century. At 31 December 2016, 46 licensees were represented in 523 active production licences. Several companies are pursuing developments off Norway for the first time. Good experience transfer between new and experienced players on the NCS is important.
The companies have done good work over the past three-four years in reducing costs for both development projects and field operation.
Although action was needed to curb spending, it is important to ensure that such measures do not have unfortunate effects for long-term value creation.
READ MORE: Cost trends