New Contenders Are Emerging In Norwegian Oil Fields

New Contenders Are Emerging In Norwegian Oil Fields

NorwegianWith the focus of BP and Exxon Mobil to focus on discovery in other regions of the world, a consortium of smaller companies has emerged to revitalize the country oil industry. The consortium group is buying reserves and flooding money into new and existing fields, surpassing other rivals to become Norway’s largest producer after state-controlled Equinor and Petoro.

Who is the consortium contender to rank up moving to the top 3 spot you may ask?
– Aker BP is the result of a 2016 merger between an independent Norwegian oil company and BP’s local Unit. This year alone the group is planning to invest $1.3 billion and plans to double their production to 333,000 bpd in 2023. The goal could be reached even without more transactions, per its chief executive officer.

– Var Energi AS is the result of a merger between Norway’s private-equity-backed Point Resources, which purchase Exxon-operated oil fields in the country and Eni’s local unit. The plan is to invest in the next 5 years $8 billion to increase production from 170,000 to 250,000 bpd of output by 2023.

– Wintershall is the merger between German oil companies Wintershall and Deutsche Erdoel, it is forecasted both will invest $2.3 billion in Norway from 2017 to 2021. Production is estimated at 200,000 bpd in the “near future”.

All those companies could be investing $20 billion or more by 2022, it is the equivalent of a year investment by all oil company in Norway.

Total was the third biggest producer last year with 214,000 bpd. One of those three companies could propel them above Total. Even with the additional output Total will get from the giant Johan Sverdrup project.

With this race shaping up it is going to bring a second wind for Norway and western Europe’s biggest oil and gas producers.

BP has 30% stake in Aker BP company, they are not planning on letting any of the other contenders winning the race.

“Absolutely not,” CEO Karl Johnny Hersvik said in an interview during the ONS Conference in Stavanger last month. “We actually think this is fun. Because there’s nothing that creates more innovation than competition.”

Having acquired the Exxon fields, and encouraged by new owners HitecVision AS, there is an increasing activity at Point Resources, with engineers working on how to boost output, said Kristin Kragseth, vice-president for production. She doesn’t “spend much time on the competition aspect,” said the former Exxon executive who is also the incoming CEO of Var Energi.

“We have very concrete plans to grow,” Kragseth said in an interview at ONS in Stavanger. “If that makes us one of the biggest producers, great.”

There is one more contender to the race is Lundin Petroleum. With its stake in the Sverdrup field, it is estimated it could double the company’s output by more than 160,000 bpd in four years. Per CEO Alex Schneiter, production could exceed 200,000 bpd by 2022-2023

The Norwegian oil industry is starting to see competition, boosting the economy. Let the competition unravel! will see who will take 3rd place in the race.

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