Phase 1 of the massive Johan Sverdrup project offshore Norway is now close to 60% complete, ahead of schedule and even further under the original estimated budget, says partners Aker BP and Lundin.
In statements released this morning, the two say that the partnership operating the Johan Sverdrup development, led by Statoil, has reduced the gross capital expenditure to US$11.8 billion (NOK92 billion).
"Due to improvements in project execution and delivery, gross Phase 1 development costs have been further reduced by $640,000, to $11.8 million," says Lundin. "This represents a saving of 25% compared to the original estimate in the plan for development and operation, excluding additional foreign exchange rate savings in US dollar terms."
The breakeven price for the full field development is estimated to less than $25/bbl and the total resources in the Johan Sverdrup field are estimated to between 2-3 billion boe.
Phase 1 is on track for first oil in late 2019, with an estimated production capacity of 440,000 boe/d. Phase 2 will add another processing platform to the field centre which is estimated to increase the processing capacity for the full field to 660,000 b/d. Phase 2 is scheduled to start production in 2022.
Aker BP noted that the assembly operation of the Johan Sverdrup drilling platform is currently taking place in Klosterfjorden, near Haugesund in Norway. The drilling platform is one of four platforms which makes up the planned field centre for Johan Sverdrup.
Alex Schneiter, CEO and President of Lundin Petroleum said: "The world class Johan Sverdrup project is progressing really well and continues to get better and better. It is very encouraging to see that we have now passed the halfway mark in Phase 1 of the project and are ahead of schedule. It has been my long held view that costs will continue to come down and today we can announce that the Johan Sverdrup partnership has managed to lower development costs even further."
Lundin Norway holds a 22.6% working interest in the Johan Sverdrup project and Statoil is the operator with 40.0267%. The remaining partners are Maersk Oil with 8.44%, Petoro with 17.36% and Aker BP with 11.5733%.