After some skeptical oil companies gave up plans to develop Norway’s Dvalin gas field in the Norwegian Sea, Norway’s state-owned oil company Petoro stepped in to make the investment and do the work, reports newspaper Dagens Næringsliv (DN). Petoro, which runs the state’s own offshore oil interests, thus saved the development that Oil & Energy Minister Tord Lien wanted.
“This is very good news that will spur activity, employment and value creation in the industry,” stated Lien of the conservative Progress Party. He claims Dvalin, former called Zidane, will create 6,000 jobs within the next three years in an industry that’s been hard-pressed since oil and gas prices fell.
The Dvalin gas field was discovered in 2010 and its development is expected to cost around NOK 10.2 billion over the next three years. It’s the largest new development project off Norway this year.
Others have doubted its profitability in the long term, not least since US shale gas is now being exported to Europe. Both OMV of Austria and Mærsk of Denmark pulled out of the project, with the state agreeing to buy OMV’s 20 percent stake. DN reported that Petoro will also share Mærsk’s ownership stake with operator DEA, which already owned 40 percent.
“Petoro has evaluated that the project on its own will be profitable,” Lien said. “It will also increase values in other parts of the infrastructure in the area.” The field is located around 15 kilometers northwest of the Heidrun field. It will process gas on the Heidrun platform and send it via the Polarled gas pipeline to the gas export facility Nyhamna.