Petroleum resources off Lofoten, Vesterålen and Senja

16/04/2010 On assignment from the Norwegian Parliament (Stortinget), the Norwegian Petroleum Directorate (NPD) has acquired seismic data in the areas off Lofoten, Vesterålen and Senja (Nordland VII and Troms II). On Friday, 16 April, the NPD will present its report to Minister of Petroleum and Energy Terje Riis -Johansen.

It was during the Storting's consideration of the comprehensive management plan for the Barents Sea and the waters off Lofoten (Storting White Paper No. 8 (2005-2006)) that the NPD was given the assignment of conducting geological mapping. The objective was to increase knowledge of potential petroleum deposits in Nordland VII and Troms II.

During the summers of 2007, 2008 and 2009, the NPD acquired 2D and 3D-seismics in the area, which had not previously been opened for petroleum activities. This data has contributed to increase understanding of the geology in complex areas.

The periods for the acquisition activity were chosen based on recommendations by the Directorate of Fisheries, the Institute of Marine Research and the fishers' organisations. It has been important for the NPD to organise the seismic acquisition activity in a manner that posed the least possible inconvenience for the fisheries.

Based on the new knowledge and previously acquired data, the NPD has mapped the areas and estimated the resource potential. The evaluation also covers Vestfjorden, the unopened part of Nordland V, Nordland VI and the Eggakanten area in the southwestern part of the Barents Sea.

The following are the main conclusions based on what we know today:

  • Nordland VI appears to be the most prospective area for petroleum resources
  • Nordland VII and Troms II have a total expected resource estimate which is about the same as what is expected in Nordland VI.
  • The resource estimate for oil is larger than for gas in Nordland VI and VII. In Troms II, gas appears to be the most likely possibility.

The continental shelf and the declivity off the coast of Nordland and Troms counties is made up of varied and complex geology. A total of 50 prospects have been mapped in Nordland VI,VII and Troms II. The NPD has estimated the recoverable resources based on an analysis of play models. The petroleum resources are expected to amount to 202 million Sm3 of oil equivalents, or about 1300 million barrels. The range of uncertainty in this resource estimate is expected to lie between 76 and 372 million Sm3 o.e. The figures refer to recoverable oil and gas.

Taking its basis from the updated resource scenario, the NPD has conducted an economic valuation of the petroleum resources based on a number of technical and financial assumptions.

The expected future net value is estimated at about NOK 500 billion. To highlight the added value of gradual exploration in the area, the NPD has also estimated the value using scenarios which reveal profitability that varies from NOK -10 billion to about NOK 1400 billion.

There is uncertainty associated with the estimate for the undiscovered resources. However, this uncertainty can be reduced over time, e.g. through staged exploration including the drilling of exploration wells.

Updated: 20/04/2010