Norway's latest awards in predefined areas (APA) license round has been hailed a success with some 56 exploration licenses being offered on the Norwegian Continental Shelf.
The APA rounds offer acreage in known areas on the shelf, rather than frontier acreage.
The 56 licenses are split across the North Sea (27), Norwegian Sea (24) and Barents Sea (5). The round involves in 36 different oil companies, from international majors to small Norwegian exploration outfits, of which 22 will be offered one or more operatorships. Applications were received from 43 companies.
Fourteen of the production licenses are additional acreage for existing production licenses. Five of the new licenses are divided stratigraphically and apply only to levels below/above a defined stratigraphic boundary.
"This year's APA round is among the largest ever awarded on the Norwegian Continental Shelf (NCS). It will contribute to activity both in the oil companies and in the supply industry as exploration progresses, wells are drilled and discoveries are made," says Minister of Petroleum and energy Tord Lien (Progress Party).
The Norwegian Ministry of Petroleum and Energy points out that one of the primary challenges in mature areas is the expected decline in discovery size. Minor discoveries will not be able to carry standalone developments, but may have good profitability when they can exploit existing and planned processing equipment and transportation systems, or be seen in context with other discoveries or planned developments. "Timely discovery and exploitation of such resources is therefore important," it adds.
Predictably, Statoil features large on the list of those being offered operatorship of licenses, with the most offered (13), followed by Det Norske.
The five operators offered licenses in the Barents Sea are Statoil (two licenses), Edison, Eni, and Wintershall.
Those offered licenses are:
"The number of applications has remained fairly constant in recent years. We are pleased that the oil companies still see the potential in the Norwegian shelf and are investing heavily in mature areas,” says Sissel Eriksen, director of exploration in the Norwegian Petroleum Directorate.
"Interest has been particularly great in the Norwegian Sea. The companies' applications show consistent high quality, and some have submitted very interesting exploration concepts. Most of the companies will be rewarded for their hard work through awards in APA 2015."
"It is an advantage that the geology is relatively familiar, even though surprises cannot be ruled out. Many of these areas have existing fields that are nearing the end of production, with infrastructure that can be exploited. It is therefore important that we explore the surrounding areas so that potential resources are not lost."
The offers are subject to obligations stipulated by the authorities. There is a requirement for acquisition of new seismic in four areas, and two firm wells must be drilled. For the other production licences there are “drill or drop” conditions. This means that the licensees have between one and three years to decide whether they want to drill an exploration well. If they do not wish to drill an exploration well, the production license lapses.
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