Spanish oil and gas explorer Repsol is planning to shut down its Varg field operations offshore Norway, due to the low oil prices, according to news reports.
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The Petrojarl Varg. Image from Teekay. |
In a presentation to Norway’s Petroleum Safety Authority (PSA) on 1 December, Repsol said, “Varg has been cash-negative since August 2015. Further investments in the field aren’t economical,” according to Bloomberg.
The Varg field is 200km west of Stavanger in Block 15/12 in 84m water depth.
Repsol’s Norwegian arm, Repsol Norge operates Varg, with Teekay Offshore contracted to operate the Petrojarl Varg floating production storage and offloading unit (FPSO) on a lease basis. At the field, the FPSO and one unmanned platform, Varg A, are linked together with a 1200m production and injection pipeline, and a control umbilical.
According to Bloomberg, a spokesperson for Repsol said that the FPSO contract with Teekay has been terminated and the Petrojarl Varg will leave the area on 1 August.
Despite shutting the field down, Repsol hails the Varg field as being a success producing three times the oil estimated when the project was approved by the authorities. Start up at the field began in December 1998, and was discovered in 1984.
Repsol operates Varg with 65% stake. Partners include Petoro (30%) and Det norse oljeselskap (5%).
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