First oil at the Balder field in the North Sea marks the start of a new era for the first production license on the Norwegian Continental Shelf.
Vår Energi announced the Jotun floating production, storage, and offloading (FPSO) vessel moored in about 125-m water depth in PL001 went online on 23 June. And the previous week, the operator announced reaching final investment decision (FID) for the Balder Phase VI fast-track development.
The FPSO, which sailed away from Worley’s yard in Rosenberg, Norway, in March, is expected to handle about 80,000 BOEPD from the field. All 14 production wells have been completed from what Vår Energi calls the Balder X project and will be brought onstream during the ramp-up period to peak production. Vår Energi has pegged estimated gross proved plus probable recoverable reserves from the project at 150 million BOE.
The field is already producing approximately 30,000 BOEPD through the Balder floating production unit (FPU) and Ringhorne facilities, although Vår Energi intends to decommission the FPU in a few years and transfer some of that production to the Jotun FPSO.
“With infrastructure and facilities designed to extend production beyond 2045, the startup of the Jotun FPSO opens up wide potential for continued value creation from the area,” Vår Energi CEO Nick Walker said in a press release.
Vår Energi said it is working to add new production to the Jotun FPSO through infill drilling, exploration, and tieback developments with short time to market.
The previously sanctioned Balder Phase V project is expected to begin production later this year, targeting gross 2P reserves exceeding 30 million BOE. Combined, the current Blader and Phase V projects have a payback time of about 2 years from production startup.
Phase VI and More
When Vår Energi announced sanction on the $260 million (NOK 2.6 billion) Balder VI project on 18 June, the operator said the fast-track development would contribute to sustaining long-term production to the Jotun FPSO.
In a news release, Vår Energi COO Torger Rød said the Balder area represents significant future resource potential.
“With the Jotun FPSO now installed as the new area host, we will continue to unlock additional high-value barrels from the Balder area through several phases of new developments and field optimizations. This includes Balder phase V, which will come onstream later this year. And with the FID for Balder Phase VI we are taking yet another important step to sustain production from the area through short time to market developments,” he said.
The Balder Phase VI project will develop around 15 million BOE of gross proved plus probable (2P) reserves.
The project, which consists of one additional multilateral production well, installation of a new subsea template, and a flowline that will be tied into the Jotun FPSO, is expected to begin production by the end of 2026.
The project has a breakeven price below $35/bbl and is expected to achieve payback within a year of production start at current prices.
Elsewhere in the area, Vår Energi is progressing its Balder Next project, which targets about 55 million BOE of additional gross contingent resources. That project plans to decommission the existing Balder FPU in 2028, and transfer production from some wells currently tied into the FPU over to the Jotun FPSO. Vår Energi expects decommissioning the FPU to reduce operating costs by about $130 million gross per year and reduce CO2 emissions by around 80,000 tonnes gross per year. The operator intends to accelerate production as part of an FPSO debottlenecking project.
Vår Energi said it expects to reach FID on eight total projects this year. It aims to keep its Balder area projects productive through 2045.
It operates Balder with 90% interest on behalf of partner Kistos Energy Norway AS with the remaining 10% interest.
