Companies with strong exploration activity during the lean times will reap the benefits when the oil price starts to pick up again. Obvious, yes, but how many out there are following that mantra?

Exploration in the U.K. sector has dropped to almost nothing, but across the water in Norway, things are looking more promising.

Lundin Norway, which has management with a strong geoscience ethos, understands that exploration is king and is still working hard with the drillbit, particularly in the Barents Sea, where it will resume its intensive exploration program in the coming months.

Despite being the second most active explorer off Norway behind Statoil, the company has been the most successful over the past eight years in terms of gross discovered resources.

It has adopted a focused approach, targeting the Utsira High as a core area for E&P and development as well as the Alvheim area, which has delivered a steady source of income.

The company’s first discovery—Edvard Grieg—was brought onstream last year on time and on budget.

The new focus region for Lundin is the Loppa High area in the Southern Barents Sea, where it has been successful with its Alta and Gohta discoveries. The company sees the South Barents generally as being vastly underexplored, with just 100 wells drilled so far.

In the Barents Sea as a whole it estimates there are 8.8 Bboe of yet-to-find resources, with 1 Bboe discovered over the past four years.

Lundin’s managing director, Kristin Færøvik, told E&P, “The next big thing for us is in the Barents Sea. It holds the largest volume of yet-to-find resources in terms of any basin on the Norwegian Continental Shelf.

“We are going to further appraise Alta this summer, and then we’re going to go north to the Neiden prospect, which is not too far from Statoil’s Johan Castberg development.”

She said that following on from Alta and Neiden, Lundin will target the Filicudi prospect to the west of Alta. “That license holds a string of prospects, so we are very excited about Filicudi as well. Last but not least, there are some humongous structures on offer in the 23rd round, and we have of course applied for some of that. Awards should be made before the summer.”

The wells will be drilled with the Island Innovator, which is undergoing a full winterization program at the moment.

Færøvik puts down Lundin’s success with the drillbit to people, the organization and the owner. “We have very creative explorers; we have an environment where you are definitely allowed to think out of the box; and we have been at the forefront of developing seismic technology, not just in terms of interpretation but also in terms of acquisition. We have very
good geoscientists.

“The third important ingredient is owners who are willing to take risks. We have a geoscientist running the company, so he understands and is as excited about the exploration as anyone else in the company.”

Lundin looks to be putting itself in a good place for when the upturn begins.

Comments