- Companies plan to test about 20 to 25 prospects over next four to five years
- Starting in 2028, annual drilling cost is estimated around $750 million, split equally
- Initial drilling would mostly take place at Haltenbanken in Norwegian Sea, Hove told Reuters
STAVANGER, Norway, Aug 24 (Reuters) - Equinor, Aker BP and Vaar Energi are teaming up to drill wells in less explored areas of Norway's continental shelf, aiming to make major new oil and gas discoveries after years of smaller finds, they said on Monday.
Drilling in areas that have seen little or no prior exploration activity is more expensive than in mature regions and is associated with greater risk of drilling dry holes, but could also yield bigger finds.
"By joining forces we are improving the exploration portfolio and we are also reducing the risk," Kjetil Hove, Equinor's head of Norwegian operations, told a joint press conference.
The three companies have agreed to combine expertise, data, technology and exploration capacity to pursue selected high impact exploration opportunities, they said.
Much of Norway's drilling in recent years concentrated on finding reserves around existing oil and gas fields, yielding a number of smaller discoveries that were quickly brought into production.
"Near-field exploration remains crucial, but we also need to pursue bigger opportunities to sustain activity and value creation beyond 2035," Hove said.
Norway's output is set to sharply decline during the next decade unless significant new finds are made, government forecasts show.
Over the next four to five years, the three companies plan to mature and test a portfolio of approximately 20 to 25 exploration opportunities, with an ambition to drill around five high-impact wells annually.
Starting in 2028, the combined annual drilling cost is estimated at around $750 million, divided equally between the three, they said.
Most of the initial drilling would take place at Haltenbanken in the Norwegian Sea, but could extend to all parts of Norway's continental shelf, Hove told Reuters.
Norway, Europe's largest oil and gas producer, encourages energy firms to drill for more reserves, hoping to extend the life of its petroleum industry for decades to come despite concerns from environmental groups over the climate impact.
Reporting by Nerijus Adomaitis and Nora Buli, editing by Terje Solsvik and Tomasz Janowski
Source: Reuters