Norwegian oil company Equinor has said its Johan Sverdrup field will reach plateau production faster than previously expected. The company also said that the North Sea field's plateau target will increase.
The giant oil field's first phase is now expected to reach plateau production in early May. Equinor previously expected the plateau to be reached during the summer. Plateau production will increase from around 440,000 barrels of oil per day to around 470,000 barrels per day.
"At the end of March, daily production had already exceeded 430,000 barrels of oil," Equinor said.
The Johan Sverdrup field is developed in two phases. Phase 1 was approved by Norwegian authorities in 2015 and came on stream in October 2019. Phase 2 of the development was approved in 2019 and is expected to start production in Q4 2022.
Sigve Nylund, Equinor’s executive vice president for Development and Production Norway: "The project was sanctioned during the oil price fall in 2015 and resulted in important activity to the supplier industry in a demanding period. With low operating costs Johan Sverdrup provides revenue and cash flow to the companies and Norwegian society at large in a period affected by the coronavirus and a major drop in the oil price."
The Johan Sverdrup field, sitting in a water depth of around 115 meters, came on stream on October 5, 2019, more than two months ahead of the original schedule and NOK 40 billion below the original estimate for development and operation.
The break-even price for the full-field development is below USD 20 per barrel, and expected operating costs are below USD 2 per barrel.
Rune Nedregaard, vice president for Johan Sverdrup operations said: “Johan Sverdrup has very low production costs, contributing with a strong cashflow also in periods with low prices, as we experience” says Nedregaard.
At plateau in phase 2 the field will produce 690,000 barrels of oil per day. Expected recoverable reserves in the field are 2.7 billion barrels of oil equivalent.