Oil and gas potential in the formerly disputed area in the south-east Barents Sea between Norway and Russia could be in for a downgrade after two years of disappointing exploration results, writes Ole Ketil Helgesen.

Now industry watchers are waiting for a new probe planned for next year.

Four dry wells have been drilled in the Norwegian sector since it was opened for exploration in 2013.

Korpfjell, Korpfjell Deep, Gjokaasen and Gjokaasen Deep were either dry or contained uncommercial amounts of gas, with some industry sources suggesting that operators could be close to giving up on the frontier region.

The disappointing results suggest the exploration models used to justify upbeat forecasts about the potential in the area do not apply here, exploration sources told Upstream.

Many now expect the Norwegian Petroleum Directorate (NPD) to downgrade its estimates for undiscovered resources in the area.

When the area was opened for exploration in 2013, the NPD esimated it could hold about 1.9 billion barrels of oil equivalent, with more than 80% gas and an uncertainty range stretching from 350 million to 3.6 billion boe.

NPD exploration director Torgeir Stordal admits the results so far have been disappointing, but says it is too early to write off the area.

“This area is the same size as one-third of the Norwegian North Sea. It is too early to conclude about the potential of finding oil and gas after just four exploration wells in two licences,” he said, adding that a new exploration well is planned for the area in 2020. "Much data has been collected and we expect that the companies are evaluating it. Results of these evaluations should provide a better understanding of the underground to form a basis for further exploration,” Stordal added.

Equinor, which has operated the four wells drilled so far, says it still has faith in the area. “Results have not been as we hoped for, but we still believe there is potential,” an Equinor spokesman told Upstream.

Equinor also explores in other parts of the Norwegian Barents Sea, the spokesman emphasised.

“Our exploration campaign in the Barents Sea is not yet concluded. We have recently completed the Sputnik well north of Wisting, with results expected soon, and our plan is to drill the Mist prospect south of Johan Castberg at the end of this year or early next year,” he said.

Lundin Petroleum and Aker BP also maintain that they still are committed to further exploration in the Barents Sea.

“We have several licences in the area, and we will apply for more acreage in coming licencing rounds,” a Lundin spokesperson said.

Norway handed out three licences in the south-eastern Barents Sea in 2016. After the discouraging results from Equinor's four wells in its two operated licences, all eyes will be on a planned wildcat in the third licence, operated by Aker BP, planned for next year.

The Stangnestind prospect in production licence 858 is situated on the Fedynsky High, which extends into the Russian sector of the south-eastern Barents Sea in the formerly disputed area.

Equinor is a partner in the licence, along with state-owned Petoro and Russian player Lukoil.

According to Rosneft and Eni, which cooperate on exploring in the Russian Barents Sea, two mega-closures of Permian and Cretaceous age at the Fedynsky High could hold up to 18.7 billion barrels of oil equivalent in the Russian sector.

A positive result at Stangnestind is crucial for the south-eastern Barents area as a future petroleum province, but expectations for the prospect are reduced following the recent disappointments, sources in the Norwegian exploration community told Upstream.

Weekly

South-eastern Barents Sea sector yet to reward players