Equinor and its project partners submitted the development plan for Phase 2 of the Johan Sverdrup project on 27 August with an increased resource estimate and a cut of NOK 6 billion in investment costs since 1 February. This brings to NOK 80 billion the total reduction in the estimated investment for Phases 1 and 2 development since the filing of the project development and operation (PDO) of Phase 1 in 2015.
Cost Reductions
Nearly 80% of Phase 1 development is completed. The estimated investment for it has been reduced by another NOK 2 billion. The updated total investment for Phase 1 is NOK 86 billion, a 30% reduction since 2015.
“We have worked systematically to make the second phase of the Johan Sverdrup development even more profitable and robust. We have taken the good solutions and experience gained from Phase 1 and have optimized the development concept for Phase 2 in cooperation with our partners and suppliers,” said Margareth Øvrum, executive vice president for technology at Equinor.
“In the Phase 2 PDO, we have reduced the investment estimate to NOK 41 billion, and the break-even price for Phase 2 is now less than USD 25/bbl. Throughout the entire history of this industry, I don’t think we have ever seen a project that has been improved as much as Johan Sverdrup has over the last 3 years,”
The Phase 2 PDO includes provision of power from shore to the Utsira High, as does Phase 1.
Phase 1 startup is expected in November 2019; Phase 2 startup is planned for Q4 2022.
Boost in Estimated Resources
In the Phase 2 PDO, the resource estimate for the entire Johan Sverdrup field is raised from 2.1–3.1 billion BOE to 2.2–3.2 billion BOE, with an expected estimate of 2.7 billion bbl.
In connection with the development of Phase 2, Equinor and partners have established a digitalization and technology plan for the full field to further reinforce safety and efficiency in operations, increase value, and reduce carbon emissions.
Improved recovery technologies included in the plan:
Water alternating gas injection (WAG)
PRM (permanent reservoir monitoring) for the full field
Stepwise implementation of fiber-optics in wells
Step-by-step development of digital twinning
Technologies for automatic drilling control on the drilling platform
High-speed telemetry drillpipe
Improvements in cement quality
Virtual rate monitoring on subsea wells
“Digitalization will reinforce the effect of several improved recovery technologies. Together, this has allowed us to increase the resource estimate for Johan Sverdrup, while simultaneously raising the ambitions for the field’s recovery rate to over 70%, said Øvrum.
“The sheer size and the field life of more than 50 years make Johan Sverdrup an exciting place to develop the solutions of the future. We are now working to mature technology for automatic production optimization, a number of new pipe and seabed technology solutions, and a gradual development of a digital twin of Johan Sverdrup that will give us the opportunity to model and visualize key parts of the field even before we start production for Phase 2 in 2022,” she said.
Equinor is the operator; partners include Lundin Norway, Petoro, Aker BP, and Total.
