Equinor rethinking Rosebank plan

Norwegian oil and gas company Equinor has decided to revise the original development plan for the Rosebank project located west of Shetland, which was previously operated by Chevron.

Following an announcement of the transaction in October 2018, Equinor closed the deal to buy Chevron’s 40% interest in the Rosebank field in the west of Shetland region of the UK Continental Shelf last January and became its operator.

A spokesperson for Equinor told Offshore Energy Today that Equinor is now “taking some time for a detailed assessment of the current concept, seeking to leverage experience from our next generation portfolio and value improvements made to recent project concepts such as Johan Castberg.”

Equinor’s Johan Castberg project, located in the Barents Sea, is being developed with an FPSO+ production vessel with additional subsea solutions. Compared with the original solution, costs for this project have been reduced from approximately 100 billion NOK to 50 billion.

Regarding Rosebank license, the spokesperson stated: “Any extension to the current license will be part of ongoing discussions with our partners and the Oil and Gas Authority.”

With the Rosebank deal, Equinor strengthened its portfolio in the UK’s offshore, which also includes the Mariner development, expected to start commercial production during the first half of 2019.

The Rosebank field was discovered in 2004 and lies about 130 km northwest of the Shetland Islands in water depths of approximately 1,110m. Other partners in the field are Suncor Energy (40%) and Siccar Point Energy (20%).

The potentially recoverable volumes at Rosebank are expected to be more than 300 million barrels.

Before Equinor bought Chevron’s stake and took over the operatorship of the field, Chevron planned to develop Rosebank as a subsea development tied back to a floating production, storage and offloading (FPSO) vessel, with natural gas exported via pipeline.

Even before Equinor entered Rosebank, Wood Mackenzie, an energy intelligence group, said that any buyer would need to have very deep pockets to fund the capital cost of development. Namely, WoodMac estimated it to be more than $6 billion in total.

Offshore Energy Today Staff