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UpstreamOnline: ExxonMobil leaves Skarv nest

by KNUT EVENSEN in Stavanger
Photo by VASILIY BAZIUK/AP

ExxonMobil has put its 15% stake in BP’s Skarv field on the block, another signal that the Norwegian Sea is not a top priority for the US supermajor.

Sources told Upstream that the supermajor opened a data room for interested companies last week, and suggested that ExxonMobil is testing the market to see what kind of price it can fetch for its asset.

Through recent asset transactions, ExxonMobil has signalled that this part of the Norwegian continental shelf is not part of its future plans.

Shell, an existing Skarv partner, could be among the bidders for the asset, alongside downstream gas companies.

ExxonMobil’s move to shed Skarv comes hot on the heels of the sale of its 30% operating stake in the promising but challenging Victoria gas field in Production Licence 211 to France’s Total.

As part of this deal, ExxonMobil received a 5% holding in the Tyrihans field.

The supermajor’s Skarv stake is a more obvious sale candidate, due to ExxonMobil’s relatively low ownership interest and the fact that it will be the smallest partner in the development.

BP and Norway’s Statoil are currently working on a Nkr19 billion ($3.03 billion) plan to develop the Skarv and Idun fields with subsea wells tied back to a floating production, storage and offloading vessel.

First production is expected in late 2010.

As well as the initial Nkr19 billion capital investment, the two players estimate a further Nkr10 billion will be spent on operations and Nkr16 billion on tariffs during the fields’ lifetime, bringing the total investment close to Nkr45 billion.

Skarv and Idun comprise several reservoirs and about 75% of recoverable resources are estimated to be gas, with light oil and gas making up the remainder.

The two fields hold an estimated 113 million barrels of oil and 55.8 billion cubic metres of gas.

Further reserves could possibly be added if successful exploration wells are drilled on nearby prospects such as Skarv D and E, Snadd O and Idun North, South-East and East.

Apart from Skarv E, all these prospects are expected to be mostly gas bearing.

Oil will be exported by shuttle tankers, while the gas will be transported in the Aasgard Transportation System to Kaarsto and onward to continental Europe.

The operator plans to sink 20 wells in the area – 15 producers, four gas injection wells and an extra injection well.

Skarv, which means cormorant in Norwegian, located in production licences 212, 212B and 202, is operated by BP (30%). Its partners are Statoil (30%), Shell (25%) and ExxonMobil.

Idun, in licence 159, is operated by Statoil (50%), with Shell (40%) and Norsk Hydro (10%) holding stakes.

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