Record response to latest offshore Norway licensing round

Offshore staff

OSLO, Norway – Norway’s government has offered 48 companies interests in 65 new production licenses on the Norwegian continental shelf.

This follows applications from a record total of 59 companies under the country’s Awards in Pre-defined Areas(APA) 2013 license round.

Thirty-eight of the licenses are in theNorth Sea, 19 in the Norwegian Sea, and eight in the Barents Sea. Seventeen are classified as additional acreage to existing production licenses, while 10 are divided stratigraphically and only apply to levels below/above a defined stratigraphic boundary.

Interest was greatest in the northern North Sea and central Norwegian Sea.

Sissel Eriksen, exploration director for the Norwegian Petroleum Directorate, said this was probably due to familiarity with the geology, and the fact that several of these areas have a “time-critical” infrastructure. Exploring nearby areas is therefore a priority in order to maximize the tie-in resource potential.

Of the companies that applied, 29 have been offered operatorship. Petoro will participate as a licensee and manage the State’s Direct Financial Interest (SDFI) in 12 of the licenses.

Offers remain subject to obligations set forth by the authorities. New seismic must be acquired in 11 areas and one firm well must be drilled in the southern North Sea.

In other cases, the licensees have one to three years to decide whether to “drill or drop,” to prevent the license from expiring.

Statoil gained interests in 10 licenses, seven as operator. These comprise:

Barents Sea

• 40% ownership and operatorship in PL765, a new license in the Hammerfest basin.

Norwegian Sea

• 40% ownership and operatorship in PL755, east of the company’sHeidrun field center, with near-field exploration potential
• 60% ownership and operatorship in PL752 and 20% of PL751, two new licenses in the Frøya high/Froan basin. Statoil plans to take a fresh look at traditional and new plays.

North Sea

• 30% ownership and operatorship in PL745S south of the company’sValemon field in the Tampen area. Near-field exploration opportunities
• 50% ownership and operatorship in PL739S, a little explored area southeast ofOseberg
• 50% ownership and operatorship in PL072D east of Sleipner, with near-field exploration potential
• 20% of PL735S in the central Viking Graben, with potential along the northwestern flank of the Utsira High
• 77.8% ownership and operatorship in PL333B, adjacent to the high-pressure/high-temperatureKing Lear discovery
• 30% ownership in PL044B, adjacent to PL044 in the southern Norwegian North Sea.

Maersk Oil Norway secured five new concessions. Two are in the southern Norwegian North Sea, close to the Danish and UK median lines – PL728 (operated by DONG 45%, in partnership with Maersk Oil 35% and Petoro 20%), and PL732 (Maersk Oil operator with 60% and Suncor 40%).

In the Barents Sea, Maersk Oil will partner with operator Lundin in licenses PL 764 and PL766, and operator Statoil in PL765. In all three, Bayerngas is the other partner.

Det norske oljeselskap picked up six new licenses, two as operator. GDF Suez E&P Norge won a share of PL637 in the North Sea.

Norwegian independent, Noreco, gained five new licenses, two as operator. CEO Svein Arild Killingland said: “The awards are in line with our strategy to focus our efforts in mature areas with moderate geological risks and along producing geological trends.”

The two operatorships are offshore mid-Norway. PL761 is northeast of the company’s PL484 concession, where the Verdande exploration well will be drilled soon in a similar geological play. PL762 is on the Nordlandsryggen ridge. The main target is a Permian carbonate structure.

Elsewhere, Noreco was offered 20% of PL755, west of the company’s PL591 Zumba license in the Haltenbanken area. Targets are upper and middle Jurassic plays.

West of the BG-operatedKnarr development, Noreco was assigned 20% of PL748, which contains promising lower Jurassic plays, one of which is also targeted in Knarr. Finally, on PL744S (Noreco 20%) to the northwest, the main focus will be on the middle-lower Jurassic, in the same plays containing Veslefrikk and other producing fields in the area.

Faroese independent Atlantic Petroleum gained shares in two licenses. The Repsol-operated PL 763, covering parts of blocks 6606/2 and 6606/3, is southwest of the Statoil-operated Aasta Hansteen field development where production is due to start in 2017.

Prospectivity has been mapped at multiple reservoir levels from 3D seismic data. The main defined prospect is within the same geological play model that yielded theAasta Hansteen discovery.

PL 270 B, operated by VNG Norge, is in the northern Norwegian North Sea, west of the Agat discovery. Again, prospectivity has been mapped on 3D seismic data. The license is an extension to PL 270 and will follow the same work program, with a potential well in 2015.

Rocksource secured five licenses. The company will operate PL 746 S, Hernar, covering North Sea block 29/3. Phase 1 commitments include purchasing 3D seismic, with a drill-or-drop decision to be taken within one year. The company will also operate PL 754 located in the Haltenbanken area, with 3D seismic reprocessing to be followed by a drill-or-drop decision.

In the same region, Rocksource will partner Polish operator PGNiG in PL 756, covering blocks 6507/7 and 6507/10. Elsewhere the company has 60% of PL 763 in the Norwegian Sea, in partnership with Noreco and Repsol; and 10% of PL 509 CS in the North Sea (block 30/1), operated by North Energy.

Lundin Norway was awarded interests in nine exploration licenses, comprising five in the North Sea and four in the Barents Sea. It will operate four of the licenses. Details are as follows:

*operator Lundin Petroleum

Another Swedish company, Svenska Petroleum, gained interests in PL689, operated by DONG Energy, and in PL 690, operated by Bridge Energy.

Faroe Petroleum will team up with various partnerships in 10 new licenses. In the northern Norwegian North Sea, the company will operate PL740 Brasse (blocks 30/9 and 31/7) in a 50/50 partnership with Core Energy. The acreage is close to the Wintershall-operated Brage infrastructure.

The Brasse prospect is in the upper Jurassic Sognefjord formation south of theBrage field and on a possible migration route into Brage. There is upside potential in stacked reservoirs in the upper and middle Jurassic. Initially the focus will be on reducing risk by improving the existing 3D seismic dataset through re-processing.

Four of Faroe’s licenses are in the North Sea. PL731 Freya (block 8/10) is east of PL405 containing theButch discovery, which is currently undergoing appraisal drilling. The license extension contains the upper Jurassic Freya prospect, which also extends into PL666 Percy held by the same license group. Here there is a commitment to complete technical studies already initiated in PL668 Etta.
Centrica operates PL729 Katie (block 2/1). Katie is an Ula sandstone prospect extending into the license from PL668 Etta license. A well could follow on either of the concessions.

Tullow Oil operates PL670 B Betula extension (block 7/11), containing the southern extent of the Betula prospect. The location is close to the producing Ula oil field in the central Norwegian North Sea.

Faroe operates PL733 Adonia (blocks 9/5, 9/8, and 9/9), in partnership with Explora Petroleum. Two mid-Jurassic leads have been identified on a salt ridge west of Faroe’s PL620 Lola license in the Egersund basin. Adonia, one of the prospects, is a down-thrown trap, while Stella is an up-thrown three-way closure. Technical studies could be followed by 3D seismic acquisition.

In the Norwegian Sea, Faroe will partner with operator Centrica in license PL749 Seychelles and Maldives (blocks 6306/4 and 6306/5), east of theOrmen Lange field. The Seychelles and Maldives prospects are on a structural nose on a down-faulted terrace from the Frøya High, with potential reservoirs in the upper and middle Jurassic. The partners will acquire 3D seismic acquisition to improve understanding of the structural and sedimentological setting of the area.

In the Halten Terrace Area, Faroe has stakes in four new licenses. In each case the main focus is on Cretaceous Lange formation sandstones, which delivered last January’s Wintershall-operated Solberg/Rodriguez discovery in PL475.

Wintershall leads the consortium in PL475 D Solberg South extension (block 6407/1), which covers part of the potential down-dip extension of the Solberg accumulation. An appraisal well is scheduled during the current quarter.

North Energy operates PL590 B Solberg North extension (block 6507/11), which represents a northern extension of the Solberg sandstone system. It also covers part of the potential up-dip part of the Solberg accumulation.

Faroe will also partner with Rocksource in PL754, and operator VNG in PL, close to the Njord field and PL348, which contains the Hyme field and the recent Snilehorn discovery.

North Energy won interests in the following six licenses:

• PL 503 C, block 17/5 – an extension of PL 503 in the North Sea.
• PL 509 CS, block 30/1 – an extension of PL 509 in the North Sea (operated).
• PL 590 B, block 6507/11 – an extension of PL 590 in the Norwegian Sea (operated).
• PL 762, blocks 6608/6, 9, and 6609/4, 7 – in the Norwegian Sea.
• PL 770, blocks 7123/6 and 7124/4, 5 – in the Barents Sea.
• PL 769, blocks 7124/4, 5, 6, 8, and 9 – in the grid area of the Barents Sea.

Bayerngas Norge won positions in nine licenses including two operatorships. The awards were mainly in the company’s core areas around the Frøya High and the Utsira High.

The full list of award winners is as follows:

Operatorships:

A/S Norske Shell (3)

Bayerngas Norge AS (2)

Centrica Resources Norge AS (3)

ConocoPhillips Skandinavia AS (1)

Dana Petroleum Norway AS (2)

Det norske oljeselskap ASA (2)

DONG E&P Norge AS (2)

E.ON Ruhrgas Norge AS (1)

Edison International Spa Norway Branch (3)

EnQuest Norge AS (1)

Faroe Petroleum Norge AS (2)

Lotos Exploration & Production Norge AS (2)

Lundin Norway AS (4)

Maersk Oil Norway AS (1)

Marathon Oil Norge AS (1)

Norwegian Energy Company ASA (2)

North Energy ASA (2)

OMV Norge AS (1)

PGNiG Upstream International AS (1)

Premier Oil Norge AS (2)

Repsol Exploration Norge (1)

Rocksource ASA (2)

Statoil Petroleum AS (7)

Suncor Energy Norge AS (2)

Talisman Energy Norge AS (1)

Total E&P Norge AS (2)

Tullow Oil Norge AS (4)

VNG Norge AS (3)

Wintershall Norge ASA (5)

License interests (number of shares in brackets, including where the companies are operators)

Atlantic Petroleum Norge AS (2)

A/S Norske Shell (4)

Bayerngas Norge AS (9)

Bridge Energy AS (2)

Capricorn Norge AS (3)

Centrica Resources Norge AS (10)

Chevron Norge AS (2)

Concedo ASA (7)

ConocoPhillips Skandinavia AS (2)

Core Energy AS (3)

Dana Petroleum Norway AS (3)

Det norske oljeselskap ASA (6)

Dong E&P Norge AS (2)

E.ON Ruhrgas Norge AS (2)

Edison International Spa Norway Branch (5)

ENI Norge AS (1)

EnQuest Norge AS (2)

Explora Petroleum AS (3)

ExxonMobil Exploration & Production Norway AS (1)

Faroe Petroleum Norge AS (10)

Fortis Petroleum Norge AS (6)

GDF SUEZ E&P Norge AS (1)

Idemitsu Petroleum Norge AS (1)

Ithaca Petroleum Norge AS (2)

Lime Petroleum (5)

Lotos Exploration & Production Norge AS (2)

Lundin Norway AS (9)

Maersk Oil Norway AS (5)

Marathon Petroleum Norge AS (1)

Moeco Oil & Gas Norge AS (1)

Norwegian Energy Company ASA (5)

North Energy ASA (6)

OMV Norge AS (2)

Petrolia Norway AS (1)

PGNiG Upstream International AS (1)

Premier Oil Norge AS (2)

Repsol Exploration Norge AS (3)

Rocksource ASA (5)

Skagen44 AS (5)

Spike Exploration Holding AS

Statoil Petroleum AS (10)

Suncor Energy Norge AS (4)

Svenska Petroleum Exploration AS (1)

Talisman Energy Norge AS (3)

Total E&P Norge AS (4)

Tullow Oil Norge AS (8)

VNG Norge AS (6)

Wintershall Norge ASA (8)

01/22/2014