Equinor Delays U.K. Rosebank Investment Call Until 2022

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Written by Martin Lynch, European News Editor for Industrial Info (Galway, Ireland)--Norway's Equinor (NYSE:EQNR) (Stavanger, Norway), formerly Statoil, has pushed back a final investment decision on the large Rosebank oilfield prospect in the U.K. North Sea until May 2022.

Rosebank, which lies about 130 kilometres (km) northwest of the Shetland Islands, is one of the largest undeveloped oil and gas fields on the U.K. Continental Shelf (UKCS) and is estimated to hold more than 300 million barrels. Consultancy firm Wood Mackenzie estimated that the complex project will cost roughly $6 billion to fund, but Equinor has said that the delay will allow it to make more savings.

"Together with our partners, Suncor and Siccar Point, we are fully focused on bringing this much anticipated U.K. development to realisation," said Hedda Felin, Equinor's senior vice president for U.K. and Ireland Offshore. "We believe there is more value to capture in Rosebank, including the opportunity to reduce development cost. There are similarities with other recent projects in Equinor's portfolio, such as Johan Castberg and Bay du Nord, where we have made significant improvements to the concept approach, particularly in how we design and plan new developments in harsh environments, but also through the application of digitalisation. We see that improvements in the concept and planning phase will also support an efficient execution of the project."

The delayed investment decision was facilitated by the award of a three-year extension for the Rosebank licences by the U.K. Oil and Gas Authority. Equinor bought its way back into the project last October, when it purchased Chevron's (NYSE:CVX) (San Ramon, California) 40% stake in Rosebank for an undisclosed sum. Discovered in 2004, the project has been stop-start ever since. The other partners are Suncor Energy (40%) and Siccar Point Energy (20%). For additional information, see October 9, 2018, article - Equinor Buys Chevron's 40% Stake in Major U.K. Oil Field.

Equinor currently is developing Mariner, one of the largest upstream investments in the U.K. in recent years, with a gross investment of more than 5 billion euro ($5.6 billion).

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