Spirit to File Fogelberg Plan in 2019
The Fogelberg discovery in the Norwegian Sea is shaping up to be Spirit Energy’s next operated development, the UK-German joint venture has concluded June 29 after concluding a successful appraisal well; the well was to determine the size and extent of the Fogelberg find and how well the gas flows.
Spirit Energy calculates that the discovery contains between 40mn and 90mn recoverable barrels of oil equivalent of gas and condensate. Previous projections indicated between 23mn and 94 mm boe.
“We aim to submit a plan for development and operation to the authorities in 2019, which will allow for production to start in 2022,” said Spirit Energy Norge managing director, Dag Omre.
Faroe Petroleum, one of Spirit’s partners in Fogelberg, said that June 29 that, during a drill stem test, the appraisal well flowed 21mn ft3/d and 547 b/d condensate (4,047 boe/d in total) for 24 hours. Equity analysts Cantor Fitzgerald said the successful sidetrack well justified it maintaining its 'buy' recommendation on Faroe's stock.
Estimated $1bn project cost
Spirit said that, if a decision is made to develop Fogelberg, the plan will be for this to be a seabed solution tied into the Asgard B platform, whence processed gas would be sent via the Asgard Transport pipe to Karsto, with condensate stored on Asgard C until it is transported by tanker.
Industry sources put the estimated cost of such a development would be £700mn-£800mn ($915mn-$1.05bn).
The Fogelberg licence is operated by Spirit Energy with a 51.7% stake, partnered by Polish state-run PGNiG 20%, UK-listed Faroe Petroleum 15% and Dutch SHV-owned firm Dyas 13.3%. Dyas' sale of its stake to Faroe is pending Norwegian government approval.
Spirit Energy is also developing the Oda oil field in the North Sea, due to start producing in 2019.
Spirit Energy was created last year by the merger of Centrica’s upstream business with Bayerngas Norge; it is now 69%-owned by Centrica and 31% by Bayerngas Norge’s German former shareholders, led by Stadtwerke München and Bayerngas.