Rising Costs Terminate Kristin Gas Export Project
Norwegian oil giant Statoil has announced that the Kristin gas export project (KGEP) partners today made a decision to terminate the project due to unsustainable economics caused by increased investment costs and increased risk to volume availability.
The Kristin gas export project (KGEP) – a pipeline connection between the Kristin field and Polarled – was sanctioned by the KGEP partners (Statoil 53.4%, Petoro 35.6% and GdFS 11%) in conjunction with the Polarled project sanction late 2012.
Following the last year’s project development, the partners have decided to terminate the project based on unsustainable project economics. The drivers behind the decision are increased costs and volume risk.
KGEP represented less than 5% of the Polarled volumes and the termination does not influence the Polarled project execution. All relevant stakeholders have been informed about the KGEP partners’ decision to terminate the project.
“It is a necessary decision that has been taken by the KGEP partners. With the deteriorating project economics, we did not see grounds to continue the KGEP development,” says Polarled development project director Håkon Ivarjord.
KGEP included Kristin platform modifications and a 30-kilometre pipeline to tie into the Polarled pipeline. The opportunity for the future connection of the Kristin field to the Polarled pipeline is maintained as necessary connection points continue to be part of the project.
January 09, 2014