The Norwegian subsidiary of Polish state-owned PGNiG said it has acquired a stake in the Neptune-operated Duva field currently being developed in the Norwegian North Sea.
PGNiG Upstream Norway said it acquired 20% shares in the field – PL 636 and PL636B licenses – from Norwegian independent Wellesley Petroleum. First production is expected at the turn of 2020 and 2021.
“We are focused on the implementation of the strategy related to the increase in production in Norway, which is why we consistently build our portfolio of shares in licenses on the Norwegian Continental Shelf,” said Piotr Woźniak, President of the PGNiG Management Board.
“Duva field has been one of the most promising development projects on the NCS in recent years. It is characterized by the exceptional good quality of reservoir rock. Estimated reserves and the proximity to existing infrastructure reduce development and production costs. We estimate that the average natural gas production from the Duva field by PGNiG during the first five years of operation of the Baltic Pipe gas pipeline between 2023 and 2028 will amount to 0.13 billion cubic meters annually,” he added.
The Duva field is an oil and gas development project discovered in 2016. It is located approximately 140 kilometers north of the city of Bergen. According to data from the Norwegian Oil Directorate, the deposit's resources are 88 million barrels of oil equivalent (including approximately 8.4 billion cubic meters of natural gas).
In June 2019, the Norwegian Ministry of Petroleum and Energy approved the Duva plan for Development and Operation. The field will have three production wells – two producing oil and one producing natural gas, with the potential for an additional oil well. After the commencement of exploitation planned at the turn of 2020 and 2021, the maximum annual production from the deposit in the initial period is to amount to approximately 30,000 boe. The operator of the license is Neptune Energy Norge (30% of shares). The remaining shareholders, apart from PGNiG Upstream Norway, are Idemitsu Petroleum Norge (30%) and Pandion Energy (20%).
Chris Elliott, CEO of the Wellesley Group of companies, said, “For Wellesley, this transaction allows us to redeploy our development resources to mature our operated Grosbeak development project, whilst maintaining focus on our core business of exploration. PL636 was Wellesley’s first license on the NCS and we are proud of our contribution to the exploration, discovery and development planning of Duva. However, at this phase in the project PGNiG is a more logical owner and I believe their deep experience of oil and gas development and production will be a valuable asset to the Duva development partnership.”
“We remain confident in the potential of the NCS to deliver high quality commercial discoveries like Duva in the coming years,” Elliott added.
PGNiG Upstream Norway has been moving to increase its stakes on the NCS. Its most recent acquisitions were the purchase of 42.4% shares in the Tommeliten Alpha field in 2018 and 22.2% shares in the King Lear field in June 2019. After finalizing the transaction related to the Duva field, the company will hold shares in 27 licenses on the Norwegian Continental Shelf, where it is an operator on four of them.