PGNiG: Production start-up from Ærfugl field in Norway

Warsaw, April 23 - Neftegaz.RU. PGNiG Upstream Norway has started production from yet another field on the Norwegian Continental Shelf. The licence partners, including Aker BP as an operator and PGNiG as a partner, have brought on stream the 1st production well in the Ærfugl field, with further wells planned to start production later this year.

Ærfugl is extremely attractive in terms of profitability. Production from the field is economically viable at oil prices above $15 per barrel, as wells can be connected to the existing Skarv FPSO vessel, significantly reducing field development costs. Therefore, PGNiG and its licence partners have determined to proceed with the start-up despite the challenging market environment driven by subdued hydrocarbon prices.

Jerzy Kwieciński, President of PGNiG said: “We are closely monitoring the situation on the Norwegian Continental Shelf, which is feeling the impact of the coronavirus pandemic like the rest of the world. So far production on licences where PGNiG is a partner as well as other licences in the region has continued without disruption."

The development plan for the Ærfugl field envisages drilling 6 well in 2 phases. The well that has just started production is the 1st of 3 wells planned in the 2nd phase of the development. The phase-2 wells were originally slated for production start-up in 2023. The development work accelerated after technical measures were taken to increase the Skarv FPSO’s capacity.

Production from the other 2 wells planned in phase-2 of the development is expected to start in 2021, whereas the 3 wells in phase one are planned to start production in late 2020.

Ærfugl is a gas & condensate field with recoverable reserves estimated at 300 million barrels of oil equivalent. In the peak year, PGNiG’s production from the field will reach roughly 0.5 bcm of natural gas, to be fed into the Baltic Pipe.

PGNiG Upstream Norway holds an 11.92% interest in the licence. The operator is Aker BP and the other partners are Equinor Energy and Wintershall DEA.