Det norske files plan for Froy oilfield

Norwegian independent oil company Det norske oljeselskap filed an application last Friday for redevelopment of the dormant Froy oilfield in the North Sea for a 2012 start-up, Det norske said yesterday.

Froy was in production in 1995-2001 with Elf as operator, but recovery rates were lower than projected, and low oil prices and technical problems caused it to be shut.

'Recoverable reserves from the Froy Field are estimated at 56 million barrels, with an initial production of about 28,000 barrels per day,' Det norske oljeselskap ASA said in a statement.

Det norske had filed a preliminary plan for development of the field in March, but it took months for the company to win support for the plan from its partner, UK independent producer Premier Oil which had thought it was too expensive.

It said the investment budget for the development on a 100 per cent basis was seen at 2.1 billion Norwegian kroner (S$521 million), down from an earlier estimate of three billion kroner.

'Det norske is very pleased that Premier Oil Norge now has given its full support to the plan,' Det norske's chief executive Erik Haugane said in the statement. Det norske and Premier each hold 50 per cent of the licence.

'With today's oil prices, we expect to produce oil for more than 30 billion Norwegian kroner.

Det norske has already signed a 10-year deal to lease a jack-up production rig for Froy from Teekay Petrojarl AS, a unit of US-listed shipping group Teekay, which will build and operate it.

The field will be developed with eight wells and oil will be stored in a tank on the seabed until it is offloaded to shuttle tankers for transport to the market, Det norske said.