Equinor plans $2 billion Breidablikk oilfield development

OSLO (Reuters) - Equinor EQNR.OL and its partners in Norway's Breidablikk oil discovery have agreed on an 18.6 billion Norwegian crown ($1.95 billion) development of the North Sea discovery, the state-controlled company said on Monday.

FILE PHOTO: Equinor's logo is seen next to the company's headquarters in Stavanger, Norway December 5, 2019. REUTERS/Ints Kalnins

The plan was the latest in a string of oil and gas investments announced since June, when the Norwegian parliament introduced tax breaks for the industry in a bid to preserve jobs threatened by the COVID-19 pandemic.

“The Breidablikk field is one of the largest undeveloped oil discoveries on the Norwegian continental shelf,” Equinor said in a statement.

Partners in the field are ConocoPhillips COP.N, Petoro and Vaar Energi, a unit of Eni ENI.MI.

The field is estimated to contain some 200 million barrels of oil, and is scheduled to begin output in the first half of 2024, Equinor said.

Energy minister Tina Bru welcomed the project, calling it important for the country.

“The Breidablikk development will provide great value creation, tax revenues for the community and significant ripple effects for companies and local communities on the mainland,” she said in a statement.

Deploying remote-control technology designed to cut costs, the field will have subsea-installations only, rather than a traditional platform, taking advantage of its proximity to the older Grane oil platform and an extensive pipeline network.

The project also comes at a time of declining oil output from Grane, Equinor noted.

“This is an important project in terms of improving recovery from the Grane area, and it is also a good utilisation of existing infrastructure,” said Arvid Oesthus, assistant director at the Norwegian Petroleum Directorate (NPD).

The Breidablikk field consists of discoveries made in adjacent licenses, in which the operators have differing stakes, and the final distribution of ownership of the field will thus be decided by the energy ministry, Equinor said.

Reporting by Nora Kamprath Buli and Terje Solsvik; Editing by Himani Sarkar, Sherry Jacob-Phillips and Emelia Sithole-Matarise