Basis for increased gas transport from the Barents Sea South

Rapport-gasstransport-overrekkelse-3

Minister of Petroleum and Energy Sylvi Listhaug receives the report on gas transport from CEO of Gassco, Frode Leversund (left). Kjell Agnar Dragvik, Director Analyses and framework at the NPD, also attended the presentation.

13/01/2020 Today, Gassco presented a new report regarding the transport of gas from the southern Barents Sea. The report shows that it could be socio-economically profitable to increase the transport capacity for gas, thereby further increasing value creation in the Barents Sea.

Value creation now and in the future

The report, "Assessment of gas transport alternatives in the southern Barents Sea", was presented to Minister of Petroleum and Energy Sylvi Listhaug on Monday.

The Norwegian Petroleum Directorate (NPD) contributed in the preparation of the report. The objective was to prepare a broad and up-to-date factual basis in order to assess the opportunities for greater value creation associated with increased transport capacity for gas from the southern Barents Sea.

The study's two most important observations are:

  1. Increased gas export capacity will facilitate greater value creation from fields and discoveries where resources have already been proven.

  2. Investments in new gas transport capacity could facilitate greater value creation from both proven and undiscovered resources.

The report provides a broad factual basis and proposes joint solutions that could contribute toward further developing natural resources in the Barents Sea region. Gas export from the Barents Sea currently only takes place via the Snøhvit LNG plant on Melkøya.

Current capacity at the Melkøya LNG plant will be fully utilised through 2050 based on volumes from fields in operation and from discoveries under development.

More remaining gas

The NPD assisted Gassco in the assessments of the resource base for fields and discoveries, and developed separate scenarios for undiscovered resources. These show that there may be a need for new transport capacity before 2050.

"Increased transport capacity could prove important in realising the value of the already discovered gas. We are projecting significant remaining gas resources in the southern Barents Sea, and new infrastructure could help stimulate additional exploration. We therefore support the recommendation to continue the work and mature projects for increased gas transport capacity," says NPD Director General Ingrid Sølvberg.

In contrast to previous studies, the analyses in the report show that multiple gas transport alternatives could also be profitable – based solely on proven resources. If undiscovered resources are included, even larger solutions could also be profitable. The report also shows that simpler solutions for gas transport and technology development will help reduce development and operating costs.

"An early capacity increase will facilitate more rapid development of proven gas resources, and at the same time lay the groundwork for more optimal production of oil with associated gas," says Kjell Agnar Dragvik, NPD Director of Analyses and Framework.

Crucial cooperation

Dragvik specifies that continued cooperation between players is crucial in order to find cost-effective solutions for both field developments and transport solutions. This could also reduce required investments and contribute to further value creation in the Barents Sea. Low costs and available transport capacity will stimulate the companies to explore, prove and develop the area's gas resources.

Frode Leversund, President and CEO of Gassco, also points to the importance of cooperation:

"The inherent value in developing the gas resources could be substantial from a socio-economic perspective. Developing new gas infrastructure in the Barents Sea will require cooperation across production licences, which is why it is important to continue the extensive cooperation between players in the Barents Sea. The analyses in the report provide a thorough and up-to-date factual basis for further work in the region," says Frode Leversund, President and CEO of Gassco.

The NPD's job is to contribute toward realising the greatest possible values for Norwegian society from the oil and gas industry through efficient and prudent resource management. Among other things, this involves assisting Gassco in developing good, long-term solutions for gas infrastructure.

Read the report: "Assessment of gas transport alternatives in the southern Barents Sea" (in Norwegian) (pdf)

Rapport-overrekkelse-ved-bordet.jpgKjell Agnar Dragvik (left), press and others present when the report was presented to the Minister of Petroleum and Energy.

Contact
Bjørn Rasen

Tel: +47 51 87 60 00

Updated: 13/01/2020

Latest news

Dry well east of the Ormen Lange field in the Norwegian Sea – 6306/9-1
17/01/2022 Lundin Energy Norway AS, operator of production licence 886, is in the process of concluding the drilling of wildcat well 6306/9-1.
Record-high revenues from the Norwegian shelf
13/01/2022 The combination of high production of oil and gas from a total of 94 fields, significant demand and high commodity prices led to a historically high level on the State's revenues from petroleum. Much of this is due to record-high gas prices.
Follow the livestream of The Shelf 2021
12/01/2022 Thursday, 13 January 2022 from 10:00 Director General Ingrid Sølvberg gives a summary of the Shelf in 2021.
Oil discovery near the Fram field in the North Sea – 35/10-7 S and 35/10-7 A
07/01/2022 Equinor Energy AS, operator of production licence 630, has concluded the drilling of wildcat well 35/10-7 S and appraisal well 35/10-7 A.
Drilling permit for wells 25/2-23 S, 25/2-23 A and 25/2-23 B
28/12/2021 The Norwegian Petroleum Directorate (NPD) has granted Aker BP ASA a drilling permit for wells 25/2-23 S, 25/2-23 A and 25/2-23 B, cf. Section 13 of the Resource Management Regulations.
Smarter use of data can increase value creation
21/12/2021 The Norwegian Petroleum Directorate (NPD) has taken an initiative to discuss with the industry which steps can be taken to increase value creation through better use of data.
Production figures November 2021
21/12/2021 Preliminary production figures for November 2021 show an average daily production of 1 999 000 barrels of oil, NGL and condensate.
Five companies want to store CO2
16/12/2021 The Ministry of Petroleum and Energy has received applications from five companies in connection with the announcement of two areas associated with injection and storage of CO2 on the Norwegian continental shelf.
Geobank will remain closed
14/12/2021 Due to increasing infection levels, Geobank will close starting from 15 December. This will initially apply until the end of the year.
FactMaps – operational
14/12/2021 FactMaps and related services are now operational again.