Offshore staff
STOCKHOLM, Sweden – Lundin Petroleum President and CEO Alex Schneiter has moved to reassure the company’s shareholders following recent developments. In a letter, he pointed out that the company could breakeven for the next seven years to achieve free cashflow neutrality before debt repayment and dividends with an oil price of just $17/boe.
This is because the operating costs of the company’s producing Norwegian fields are among the lowest in the industry, he claimed, with a long-term guidance of $3.2-$4.2/boe.
The main assets are Johan Sverdrup and Edvard Grieg in the North Sea which account for more than 90% of the company’s production.
As for the spread of COVID-19, Schneiter said personnel at the Edvard Grieg platform complex would be kept at the minimum level required, while preserving the infill drilling program and installation of equipment for the Solveig/Rolvsnes subsea tiebacks.
Similar actions are being taken at Alvheim and Johan Sverdrup, operated respectively by Aker BP and Equinor.
Lundin has identified cost reductions of around $170 million that it will implement this year, partly through freezing and postponing certain activities.
Operationally, Edvard Grieg continues to outperform expectations both below and above surface, he said, with limited water production. Progress at Johan Sverdrup and the Phase 2 project remains strong.
The Solveig and Rolvsnes extended well test projects are on track, with offshore installation of the pipelines and subsea equipment just under way.
03/24/2020
