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The vessel that will tap Norway’s newest oil field is now undergoing final checks before setting sail for the Barents Sea, the latest stage of the country’s push to extract more resources from the Arctic.
The startup of the the Johan Castberg production vessel later this year “opens up a new oil province in the Barents Sea, and this field can become a hub for new discoveries,” Equinor ASA chief executive officer Anders Opedal said, speaking to dockyard workers last Tuesday at the coastal village of Stord, Norway.
Once the infrastructure is in place, it will be easier to connect additional oil finds to the floating production, storage and offloading vessel, he said.
Prime Minister Jonas Gahr Store’s government is keen to maintain Norway’s position as a key energy supplier to Europe, and sees the largely unexplored Arctic as the main source of future reserves.
Estimated to hold more than 60% of Norway’s undiscovered hydrocarbon resources, the Barents Sea has long tempted the oil and gas industry, even as harsh conditions and the lack of infrastructure make developing the region difficult.
Norway’s pursuit of Arctic oil and gas has come in for some criticism, with opponents arguing that the drilling flouts the country’s climate responsibilities.
Efforts to block exploration
In 2020, activists took the government to court saying that allowing new oil drilling in the Barents during a climate crisis breaches fundamental human rights. But efforts to block exploration have failed.
Norway today supplies some 30% of Europe’s natural gas, becoming its biggest supplier after Russia’s invasion of Ukraine in 2022. Though oil production peaked in the early 2000s, the country still produced over 654 million barrels in 2023, or about 2% of global oil consumption.
The country has reduced the industry’s emissions, including by powering offshore platforms with renewable energy from wind turbines, but even with these pioneering efforts Norway remains a major exporter of fossil fuels that ultimately contribute to climate change.
At 313m-long, the Johan Castberg production vessel is about the same length as the world’s biggest aircraft carrier, the USS Gerald R. Ford. Its tanks have the capacity to hold as much as 1.1 million barrels of oil, drawn from 30 wells.
The ship will spend much of the summer at the dock and anchored in the fjord near the Stord shipyard undergoing final checks, before heading north to start production in the fourth quarter, eventually ramping up to about 220,000 barrels a day.
“There is enormous value lying on the seabed that this ship will pump up, of course in US dollars and kroner and money for the wealth fund as a result, but basically also energy,” Finance Minister Trygve Slagsvold Vedum told the crowd at the event last Tuesday. “That’s what the last two years have shown us, is that the world needs energy – people need energy.”
Located above the Arctic circle and about 240km northwest of Europe’s biggest liquefied natural gas production facility at Hammerfest, the Johan Castberg field is estimated to hold between 450 million and 650 million barrels of oil.
Licence holders are Equinor with 50%, 30% held by Energi ASA and Petoro ASA with the remaining 20%.
Norwegian oil and gas companies are picking up the pace of drilling this year in the Barents, the Norwegian Offshore Directorate said in January.
Of the 40 to 50 exploration wells planned for 2024, between eight and 10 are in the Barents Sea. This would make 2024 the most active year in the Barents since 2017.
Excitement in what Norway’s High North might hold has ebbed and flowed since the region was opened for exploration in 1980. — Bloomberg
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