Aker BP Plans $600 Million Hod Oil Field Redevelopment

Written by Martin Lynch, European News Editor for Industrial Info (Galway, Ireland)--A plan for the $600 million redevelopment of the Hod oil and gas field in the Norwegian North Sea has been submitted to the Ministry of Petroleum and Energy by partners Aker BP and Pandion Energy.

The project is one of the first to be realised under the temporary changes to the Norwegian petroleum tax system that were recently introduced to help maintain and boost investment in the sector as oil prices plummeted due to the COVID-19 pandemic. The Hod field will be developed with a normally unmanned installation remotely controlled from the Valhall field centre, which Aker BP stated will have very low CO2 emissions due to the availability of power from shore. The original Hod platform was the first unmanned platform on the Norwegian continental shelf when it started production in 1990. First oil from the new Hod platform--which will be named Hod B--is planned for first quarter 2022. Recoverable reserves for Hod are estimated at around 40 million barrels of oil equivalent (boe). Aker BP is the operator, with a 90% stake, with Pandion Energy retaining 10%.

Norway's Minister of Petroleum and Energy Tina Bru commented: "It is very gratifying to see that the companies want to extract additional resources from the Hod field. The development has positive effects for the Norwegian supplier industry now, but it also lays the foundation for jobs, production and value creation in the Valhall area for decades to come. The entire industry is in a demanding situation as a result of the COVID-19 pandemic. It is important for the supplier industry that the work on developments on the shelf does not stop, but is continued and that they are decided to be completed. This was also the purpose of the measures against the industry that a broad majority of the parliament recently adopted. We look forward to starting finalising this development plan."

"With projects like Hod, we are creating significant value both for our owners and for the society at large, while we contribute to maintaining the capabilities of Norway's world-class supply industry," explained Aker BP Chief Executive Officer Karl Johnny Hersvik.

Hod will be developed in collaboration with Aker BP's alliance partners. Five alliances will be involved, in line with Aker BP's strategy for increased value creation through alliances and strategic partnerships. Hersvik said: "The Alliance Model delivers significant cost reductions and is an efficient execution model. This is key to developing the Hod field, which is expected to contribute with 40 million barrels of oil equivalents from the Valhall area."

The steel jacket and topside will be constructed by Kvaerner Verdal, and five wells with sidetracks will be drilled in order to increase recovery.

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