Making More and Bigger Discoveries

Author Halfdan Carstens

A significant number of discoveries have been made on the Norwegian continental shelf (NCS) for the last two years. Even more important, the trend is towards making bigger finds. Since the merger between Statoil and Norsk Hydro exactly two years ago (October 1, 2007), StatoilHydro's international and Norwegian exploration efforts have proven more new resources than what has been produced.

Tove Stuhr Sjøblom has been senior vice president for exploration on the Norwegian continental shelf since December 1, 2008. She graduated from NTNU in 1991, and then joined Norsk Hydro. She has primarily worked Norwegian Continental Shelf and international exploration, but she also held the position as Ormen Lange asset manager the last two years of the development project. Photo: Halfdan Carstens

StatoilHydro has been drilling a high number of wells on the Norwegian continental shelf since the merger. What is the latest count for those two years?  

Late August, the total well count since October 2007 is 70 exploration wells (including wildcats and appraisals). The wells are drilled on all part of the shelf; from frontier drilling in the Barents Sea and the deep water of Norwegian Sea to near field exploration securing resources to our maturing fields.  

Well done!  But you have also many oil and gas discoveries. Dry wells are certainly not the rule!  

So far, we have encountered movable hydrocarbons in 53 of the wells drilled, resulting in a record high discovery ratio. These results are reflecting a very rich petroleum province.  

More important, the trend is towards finding larger accumulations?  

Somewhat surprisingly, the increased exploration activity level has given a trend of increased discovery sizes compared to the discoveries made in 2006/2007. To us this is a very interesting and encouraging result confirming that the NCS is not over-mature, but is likely to yield substantial discoveries in the years to come.  

One of your success stories is value creation in mature areas, as exemplified in the Oseberg area.  

As an operator of major fields on the NCS, exploring for new volumes to utilize existing infrastructure is a major part of our focus. As an example, the exploration drilling around Oseberg has proven more than 200 million barrels o.e. recoverable resources through exploration the last two years. Another interesting story is Gullfaks, where close to 25% of the current production is proven through exploration after production start of Gullfaks main.  

It also turns out that you have made some finds that are classified as "high impact discoveries", with recoverable reserves exceeding 250 million barrels o.e.!  

Some of the discoveries made have a total potential in that range. It should then be mentioned that they are proven through several wells on a structure or structural elements in an area that could naturally be part of one field development.  

Meaning that StatoilHydro is now able to replace production with new reserves?  

StatoilHydro has communicated the ambition to maintain our current production level on the Norwegian Continental Shelf for the years to come. The new discoveries made provide a good basis for reaching this ambition.  

This is certainly the good news, but it is also true that you have not made any giant discoveries (>500 mill. o.e.) since Ormen Lange in the 1997. Where do you need to go to find the big ones?  

The exploration for new giants has failed. There are still areas on the Norwegian Continental Shelf that are under-explored, and that has the potential for new major fields. We believe that the coast off Nordland is the most promising area as it contains structures that have similar geology as the petroleum rich provinces further south. Also, this is an area where we do have data and a good understanding of the possibilities.  

Finally, Mrs. Sjøblom, how do you explain your current success?
 
The most critical premise for exploration success is access to quality acreage.  The introduction of the Award of Predefined Areas in 2003 encouraged the companies to do regional work in the areas of the NCS then perceived to be mature. This work has resulted in maturation of new play-models and prospects in the richest areas of the NCS. Also, a competent organization that knows the regional geology and the petroleum systems is a key to success.