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January 13, 2022

Equinor downgrades resource estimate for UK North Sea oilfield

Equinor will face a $1.8bn impairment in its Q4 2021 results due to the downgrade.

Equinor has lowered its total recoverable reserves estimate for the Mariner field, in the UK North Sea, to approximately 180 million barrels of oil equivalent.

The previous estimate was 275 million barrels of oil equivalent of recoverable reserves.

The company now anticipates a $1.8bn hit due to the revision. This impairment will be reflected in the company’s fourth quarter 2021 results that are set to be released next month.

Equinor said that the latest assessment follows an updated seismic interpretation and production experience from Mariner field’s Maureen reservoir.

The company said in a statement: “Mariner’s reserves have a wide range of uncertainty given the high subsurface complexity and the early production phase of the field.”

“This revised reservoir model is further supported by results from the first well in the Heimdal reservoir, drilled in Q4 2021.”

Equinor operates the Mariner field with a 65.11% stake. The other partners are JX Nippon (20%), ONE-Dyas (6%) and Siccar Point (8.89%).

Equinor exploration and production international executive vice-president Al Cook said: “We are committed to working with our Mariner joint venture partners to identify opportunities to improve recovery and production.

“We plan to continue drilling on the field to prolong cash flow into the future.”

Located in the East Shetland platform of the UK North Sea, nearly 150km east of Shetland, the Mariner field started production in 2019. It comprises the two reservoirs Heimdal and Maureen.

Oil produced from the Mariner field is exported to a floating storage unit. It is then transported to shore via tankers.

Equinor and its partner Wellesley recently made an oil discovery near the Fram field in the Norwegian North Sea.

Based on preliminary calculations, the finding holds approximately 21 to 33 million barrels of recoverable oil equivalent, or 3.3 to 5.2 million standard cubic metres of recoverable oil equivalent.

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