Equinor makes investment decision for Lavrans, Kristin Q discoveries
Equinor, Petoro, Vår Energi, and TotalEnergies have decided to develop the Lavrans discovery and the Kristin Q-discovery which is a part of the Kristin field.
Equinor said on Wednesday that this constitutes Phase 1 of the Kristin South project and that the plan for development and operation (PDO) would be submitted to Norway’s Minister of Petroleum and Energy during the day.
According to the Norwegian energy giant, capital expenditures for this first phase will total about NOK 6.5 billion ($760 million).
Equinor’s EVP for projects, drilling, and procurement Arne Sigve Nylund said: “The decision to develop the Kristin South area will generate substantial value for society and the owners. We exploit the resources and the existing infrastructure favourably while contributing to further development of the Norwegian Sea.
“We have also awarded contracts worth about NOK 2.2 billion (around 260 million). These assignments will help maintain jobs in Norway”.
Production from Lavrans and Kristin Q will be tied into the Kristin platform. A subsea template will be installed at Lavrans, while at Kristin Q an already installed subsea template will be reused. A total of five wells are planned to be drilled – four at Lavrans and one at Kristin Q.
The Kristin field was put on stream in 2005. The technical life of the Kristin platform is estimated to end in 2034, with the possibility of further life extension to 2042.
Equinor’s EVP for exploration and production for Norway, Kjetil Hove said: “Extending the productive life by utilizing the infrastructure we have on the NCS for satellite developments is very important and ensures good profitability and low CO2 emissions”.
Equinor stated that the Lavrans discovery was discovered in 1995. The discovery has a large gas volume and a high-value potential. Lavrans is a complex reservoir and the production qualities are uncertain so the wells are designed to reduce uncertainty by having long horizontal production zones in the reservoir.
Kristin Q is located in the southern part of the Kristin field. Like the rest of the Kristin field, Kristin Q is an HPHT reservoir. Both will be developed as one project with a shared pipeline to the Kristin platform.
The expected production in Phase 1 of the Kristin South project is estimated at 6.2 GSm3 of gas and 1.9 MSm3 of oil – a total of 58.2 million barrels of oil equivalent.
Production from the first three wells, two at Lavrans and one at Kristin Q, is scheduled to start in 2024. Production start for the two last wells at Lavrans is scheduled for 2025.
The plan for development and operation also includes a description of possible future phases of the Kristin South project, including a possible next phase of Lavrans, as well as possible development of the Erlend and Ragnfrid discoveries.
Equinor estimates that more than 60 per cent of the investments in the project will go to Norwegian suppliers, and about one-third will go to companies in mid-Norway.
“[…] national employment effects of Phase 1 of the development is estimated at slightly less than 4,000 person-years of employment divided on six years in the period 2020-2025. Regional employment effects of the development in mid-Norway are estimated at 800 person-years of employment in the same period”, Equinor said.
As the contracts for the development go, Aker Solutions has been awarded the contract for subsea production facilities. The contract has an estimated value of about $117 million and includes subsea template fabrication and deliveries from Norway, Brazil, the UK, and Malaysia.
TechnipFMC has been awarded the contract for the fabrication of pipeline, pipelaying, and subsea installation services. The total contract value is estimated at around the same value as the one for Aker Solutions.
Aibel will be in charge of EPCI work for the modification of the Kristin platform. The deal is worth about $22 million. Equinor added that all contracts are subject to government approval of the plan for development and operation.
In connection with the investment decision and plan for development and operation for the Kristin South project, the partners have signed an agreement to extend the area for the partnership Haltenbanken West Unit, making the discoveries Lavrans, Erlend and Ragnfrid in addition to the Kristin field part of Haltenbanken West Unit as of 1 June 2021 – it now comprises production licenses 134 D, 199, and 257.