Friday 17 March 2017

Norway is set to give a significant boost to its unproven oil and gas resources next month as it includes the northern part of the Barents Sea as a potential new petroleum province.

It is understood that Petroleum & Energy Minister Terje Soviknes will announce a substantial increase in the official figure for probable resources off Norway on 25 April.

The revision is based on new conclusions from the Norwegian Petroleum Directorate (NPD) after a detailed mapping of the prospectivity in the northern parts of the Barents Sea through extensive gathering of seismic data and cores.

This area, which stretches north to the Svalbard islands, is currently not open for petroleum activity.

While she was not allowed to disclose the exact figures, NPD head of exploration Sissel Eriksen stated that the results were “tremendously exciting”.

“We have identified huge structures with similarities to proven structures in the Barents Sea, like the Loppa High,” she said.

“Two pronounced structures in the Barents Sea North are Sentralbanken High and Storbanken High, and both are comparable in size with the well-known Fedinsky, Loppa and Stappen highs.”

The large northern Barents Sea area has potential for several large oil and gas accumulations in different geological strata, for instance in carbonates and Permian rocks, which have proven successful farther south in the Barents Sea, according to Eriksen.

“The top Permian stratum is shallower in the north than in the south, which is positive with regard to the chance of movable hydrocarbons,” she explained.

The NPD has gathered extensive data from an area covering 39,000 square kilometres, with “extremely promising” results, Eriksen said.

The NPD rarely uses words such as “significant potential” and “huge structures” when presenting new material.

“However, one must bear in mind that this is just an early estimate, and we have not used 3D seismic and not identified specific exploration prospects,” Eriksen cautioned.

The new data from the Barents Sea North will significantly increase the total figure for undiscovered resources in Norway as a whole, Eriksen confirmed. The current official estimate for undiscovered resources is about 18.4 billion barrels of oil equivalent, about half of which is believed to lie in the opened part of the Barents Sea.

The April announcement from the minister is likely to draw strong reactions from both geopolitical and domestic circles.

While Norway has sovereignty over the Svalbard islands, the international Svalbard Treaty gives the treaty countries access to its natural resources, and Russia has fronted a claim that this right also applies to resources on the islands’ continental shelf.

Norway, however, argues that the Norwegian continental shelf stretches to and beyond Svalbard, and that its authority also applies to the shelf.

Norwegian environmental groups and green political parties are likely to object to Norway including in its official figures resources that are located in vulnerable, ice-covered areas. Any future petroleum activity might also come into conflict with fisheries, especially at the Storbanken High with its large and important fishing grounds.

Frederic Hauge, leader of environmental group Bellona, commented that it would be “utterly unwise” for the minister to open these areas for oil exploration.

“This is madness. By including Barents Sea North in the official resource figures, Norway signals that it intends to start petroleum activity in this area. This will escalate the geopolitical tensions in the north, as well as threaten the vulnerable environment in this ice-covered area,” Hauge.