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-track development will be a key contributor to sustaining long term, high-value
production through the newly installed Jotun floating production storage
offloading vessel (FPSO).
COO of Vår Energi, Torger Rød, said:
“The Balder area in the North Sea is one of Vår Energi’s core hubs and
constitutes 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 optimisations. This includes Balder phase V, which will come on stream
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.”
Vår Energi is on track to reach production levels of more than 400 thousand
barrels of oil equivalent per day (kboepd) in fourth quarter this year and the
Company aims to organically sustain production long term through developing a
highly attractive portfolio of around 30 early phase projects. Balder Phase VI
is one of around eight project sanctions expected this year.
The Balder Phase VI project will develop around 15 million barrels of oil
equivalent (mmboe) of gross proved plus probable (2P) reserves for a capital
spend of NOK 2.6 billion (USD 260 million) gross. The project has strong
economics, with a break-even well below 35 USD per barrel, IRR above 35% and
will pay back in less than a year from start of production at current prices.
The project consists of one additional multilateral production well,
installation of a new subsea template, and a flowline that will be tied into the
Jotun FPSO. The sanctioning of Balder Phase VI aligns with Vår Energi’s strategy
of maximising value in core hub areas by utilising existing capacity and
infrastructure and demonstrates how the upgraded Jotun FPSO will contribute to
continued value creation in the area. Balder Phase VI is expected to come
onstream by the end of 2026.
In addition, in the Balder area several additional early phase projects are also
being progressed, including Balder Next. The Balder Next project is targeting
additional gross contingent resources of around 55 mmboe. The project consists
of taking the Balder Floating Production Unit (FPU) to shore for
decommissioning, planned in 2028. Selected wells producing though Balder FPU
will be transferred to the Jotun FPSO. In addition, production will be
accelerated as part of the Jotun FPSO debottlenecking project to increase
production capacity on the FPSO, as well as developing new production wells. The
decommissioning of Balder FPU is expected to reduce operating costs by
approximately USD 130 million gross per annum and reduce CO\2\ emissions by
around 80,000 tonnes gross per year.
With Jotun FPSO serving as the new area host at the Balder field, production is
expected to remain at 70-80 kboepd gross towards 2030.
“While moving projects forward at pace, a major portion of our portfolio and
capital remains uncommitted, allowing for a high degree of flexibility. This
provides resilience and robustness to navigate through the cycles, whilst we
continue to move high value projects forward at the right time”, Mr Rød
concluded.
Vår Energi is operator (90%) of the Balder field, with Kistos Energy Norway AS
as partner (10%).
About Vår Energi
Vår Energi is a leading independent upstream oil and gas company on the
Norwegian continental shelf (NCS). We are committed to deliver a better future
through responsible value driven growth based on over 50 years of NCS
operations, a robust and diversified asset portfolio with ongoing development
projects, and a strong exploration track record.
Safe and responsible operations are at the core of our strategy. Our ambition is
to be the safest operator on the NCS, and to become carbon neutral in our net
equity operational emissions by 2030.
Vår Energi has around 1400 employees and equity stakes in 42 producing fields.
We have our headquarters outside Stavanger, Norway, with offices in Oslo,
Hammerfest and Florø. To learn more, please visit varenergi.no.
Contact
Investor relations
Ida Marie Fjellheim, VP Investor Relations
+47 905 09 291
ida.fjellheim@varenergi.no (ida.fjellheim@%C2%ADvarenergi.no)
Media relations
Andreas Wulff, VP Public Affairs
+47 926 16 759
andreas.wulff@varenergi.no (liv.omdal@%C2%ADvarenergi.no)
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