Giant Discovery Raises Norwegian Oil Project Hopes

Dugong could become a new North Sea production hub says offshore explorer Neptune Energy upon its latest discovery.

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In what is being called Norway’s largest oil discovery this year, Neptune Energy said its Dugong find also could become a new North Sea production hub. With a resource estimate of 40–120 million BOE and potential upside to 153 million BOE from a nearby prospect, Dugong reinforces a positive outlook for high, long-term value creation on the Norwegian shelf, according to the Norwegian Petroleum Directorate.

"Dugong may open up additional opportunities in the surrounding licenses, with the potential for a new core area for Neptune in Norway," said Odin Estensen, the company’s managing director for Norway.

Although this latest find could justify a standalone development, Neptune said its proximity to the Snorre field and to the existing infrastructure in the Tampen area, which is home to Oseberg, Statfjord, and Troll, offers multiple development options. “We will now initiate studies and consider development options for the discovery,” said Steinar Meland, Neptune's exploration and development director.

Dugong (PL 882) is located 158 km west of Florø, at a water depth of 330 m. The prospect consists of two reservoirs that lie at depths between 3250 and 3500 m.

Neptune holds a 40% stake in the Dugong discovery license, with 20% stakes held by three companies—privately owned Concedo, a subsidiary of Oslo-listed service company Petrolia, and Japan's Idemitsu.

Norway’s oil production has been rejuvenated by the 2.7-billion-bbl Johan Sverdrup field, which was discovered in 2010 and came on stream last year. Norwegian oil production reached 2.1 million B/D in April, before the authorities imposed a temporary cut to help stabilize the market.

The country continues to yield new oil discoveries, including Aker BP's 2019 Liatarnet, at 80–170 million bbl, and Wintershall’s Bergknapp in April 2020, estimated at 26–97 million BOE.