Norwegian oil and gas company Aker BP will use a semi-submersible drilling rig from Odfjell Drilling to drill four wells for its development project located in the North Sea off Norway.
Odfjell Drilling informed on Tuesday that Aker BP has exercised a scope based option for the Deepsea Nordkapp rig under the contract entered into between the companies in April 2018. This option follows Aker BP’s exercise of the second 12-month option for the same rig in March 2021.
The option covers the time necessary to complete four Kobra East Gekko (KEG) development wells. Operations on the KEG development wells are expected to begin in January 2023 with a combined duration of approximately 430 days.
As detailed by Odfjell, with the current term based contract ending in June 2023, the newly exercised KEG development scope represents approximately 8.5 months of additional backlog for the Deepsea Nordkapp occupying the unit into 1Q 2024.
The approximate contract value for the exercised optional scope is $80 million, excluding any integrated services. In addition, a performance bonus will be applicable. An additional option period has been agreed which, if exercised will follow completion of the KEG development wells.
Following the submission in June last year, Aker BP’s development plan for the KEG project was approved by Norwegian authorities last week. The field will be developed with subsea installations connected to the Alvheim field FPSO.
Total investments in the project are projected at around NOK 8 billion or about $1 billion and production is scheduled to start in the first quarter of 2024. Recoverable reserves in KEG are now estimated at around 50 million barrels of oil equivalents (mmboe).
Aker BP also said last week it would drill 13 wells this year and spend about $400 million on exploration.