Statoil reportedly looks set to delay a final concept selection on its stalled Johan Castberg field development in the Barents Sea off Norway.
The company was due to make a decision this month on the scheme after a re-evaluation of the original $15 billion concept involving a production semi-submersible with pipeline to an onshore terminal at Veidnes in the northern county of Finnmark.
However, chief executive Helge Lund told Reuters on Thursday: “We need more time to mature the concept.”
He added though “it won’t be long before we say more” on the keenly-watched project to tap the Arctic field, with estimated resources of between 400 million and 600 million barrels of oil equivalent.
A final investment decision on the project has been postponed due to high costs and resource uncertainty as well as a tax hike that has altered its commercial parameters.
While the original concept remains on the table, the operator was reported to be leaning towards an alternative solution involving a floating production, storage and offloading vessel.
UK-based research firm Wood Mackenzie recently made the case for an FPSO as a more economic solution to develop the field that would yield a better investment return, given that recent drilling around Johan Castberg has failed to deliver any substantive resource increase to justify a more costly hub solution.
The state-owned operator is though under strong pressure from the government to select a hub concept that would facilitate development of future satellite finds in the region, as well as boost the onshore economy in northern Norway.
An initial five-well exploration campaign in the vicinity of the discovery has yielded lacklustre results, although Statoil has another two nearby prospects - Isfjell and Pingvin – lined up for drilling this winter.
Statoil operates the field in production licence 532 with a stake of 50%, with partners Eni and Petoro on 30% and 20% respectively.