Ormen Lange
Offshore development is still considered the most viable development concept by the Ormen Lange Unit. However, Nyhamn in Aukra municipality is considered as the most suitable landing site for Ormen Lange if the gas is to be landed. Nyhamn will be fully evaluated against the preferred offshore development in late 2002.
The Nyhamn landing site is to be further developed towards end of 2002, and is a part of the Onshore Development Concept for bringing the gas ashore, and which is to be evaluated against a Complete Offshore Concept with direct export of gas to the European market. Relative to a complete offshore scenario, the onshore alternative produces a significant capital gap . For the time being, the Offshore Concept seems 5 - 8.000 MNOK less expensive than an Onshore Development. Updated estimates based on updated concept information will be developed towards Concept Selection late 2002.
Ormen Lange is the largest gas field under development on the Norwegian Continental Shelf.
The field is located 100 km out of the coast of Møre, and possess an estimated 400 BSM3 gas reserves. The annual production rate is set to between 15 to 20 BSM3/year, a magnitude of energy equivalent to cover the entire Norwegian current need. Participants in the Ormen Lange Development are Hydro (Operator for the Development Phase), Shell (Operator for the Operation Phase), Petoro as, Statoil, ExxonMobil and BP.
Production start for Ormen Lange is set to October 2007. Application accompanied by Plan for Development and Operation is to be delivered to the governing authorities in December 2003. The Project is now in the Concept Selection Phase where two key concepts are investigated:
- A full processing platform with direct gas export to the market.
- Production Facility at sea in combination with an onshore facility for processing and gas export to the market.
The decision whether to develop Ormen Lange as an offshore platform, or in combination with an onshore facility, is to be taken in December 2002. Still the Project, already now nine months ahead of Concept Selection, and in order to preserve a 2007 production start date for an onshore plant scenario, has to decide upon which landing site is to be included in the supporting studies. Compared with the processing of a similar platform facility at sea, more time is required for the analysis, consideration and approval of an onshore facility. In order to give the project, public professional bodies and authorities enough time to do this within the deadline until production start in 2007, the optional landing site must be decided upon nearly a year ahead of the final Concept Selection.
The identification of Nyhamn as the possible landing site is based on extensive analyses that have been in progress since spring 2000. A close cooperation has been established between the Ormen Lange Project, municipalities involved and the Møre and Romsdal County reagarding the analysis processes and the site selection criteria. In addition to the evaluation of the economic aspects, the work is based on impact assessment studies within the areas of macro/socio economic interests, health, safety and environment, all performed by independent and leading consultant companies within each of the competence areas. Nyhamn is primarily evaluated to cover the processing needs for a stand alone Ormen Lange Development, but is also assessed regarding the possibilities of becoming a future hub for other fields.
During planning/preengineering of processing equipment and integration synergies as basis for investments estimates, two different processing layout concepts have been considered for part of the Tjeldbergodden processing plant. Regarding these assessments, now after the selection of the possible site, it still remains to verify identified savings from synergy effects. The review work will be completed within May 1st, 2002.
The focus for the investigations ahead is to optimize both the Offshore - and the Onshore Concept, with the goal of identifying the key differentiators regarding value creation, costs, socio considerations, health, safety and environment.
Participants in Ormen Lange:
Norsk Hydro Produksjon a.s 18% (Operator development phase)
A/S Norske Shell 17% (Operator production phase)
Petoro AS 36%
BP Norge AS 11%
Statoil Norge AS 11%
ExxonMobil 7%