South Arne Gets 20-year Extension
Monday 17 October 2016
US operator Hess and its partners at the Danish South Arne field have received the go-ahead to keep the oil field pumping until 2047.
Danish authorities have approved an application from Hess and partners Dong E&P and Danoil to extend licence 7/89 by 20 years from the previous expiry in 2027.
The extension will allow the South Arne owners to make long-term investments in the North Sea chalk field, “securing the greatest possible revenues for the state and creating growth and activity in Danish society,” the Danish Energy Agency (DEA) said.
The aim is for the production facilities at South Arne to serve as a hub for third-party discoveries in the future, facilitating new developments, according to the DEA.
“The South Arne installation is centrally located in relation to current and future oil and gas production in the Danish part of the North Sea,” said Lars Christian Lilleholt, Denmark’s minister for energy, utilities and climate.
“It has therefore been crucial to secure favourable terms for third-party access to South Arne, benefiting future production also outside of the licence area that has been extended,” Lilleholt said.
South Arne has produced about 170 million barrels of oil and about 6 billion cubic metres of gas since it came on stream in 1999.
Oil from South Arne is currently exported via shuttle tankers from a subsea storage tank at the field, while the gas goes via pipeline to shore.
From 2027, the South Arne oil is set to be sent via an oil pipeline from the Gorm field, taking advantage of spare capacity, the DEA said.