Consortium partners involved with the Snøhvit license have announced plans to halt expansion work on the license, located in Barents Sea, as the current gas discoveries indicate expansion is not commercially viable.
The project partners have not yet decided whether to go ahead with LNG or a pipeline solution for the planned expansion in the future. Studies have been carried out by for the expansion of the gas exportation capacity from Melkøya during the last 18 months.
The company said an increase in capacity will enable the accelerated gas production of increased reserves in the Snøhvit license, in line with other existing discoveries in the area.
The partners worked with Gassco to conduct studies for a dew-point facility / pipeline solution, and reviews were also conducted for an LNG train II. Producing increased reserves in existing trains has been considered, along with the probability of increased capacity owing to new gas discoveries.
Statoil said work will now be focused on optimising and upgrading the existing LNG facility on Melkøya (train I) and further developing Snøhvit through phases 2 – 4 for train I.
Statoil executive vice president for Development and production Norway Øystein Michelsen said: "There will be major investments associated with phases 2 – 4, which include the development of Askeladd and a future compression solution."
The company intends to install five new subsea templates and drill a total of 12 production wells in the license.
Image: Snøhvit is the first offshore development in the Barents Sea. Photo Courtesy of Statoil.