Norway’s Aker BP Doubles Reserve Estimate of North Sea Oilfield

Norway’s Aker BP said it made a much bigger discovery in its Yggdrasil oilfield in the North Sea than previously estimated. Preliminary estimates suggest that the area includes a gross recoverable volume of  40 million-90 million barrels of oil equivalent (boe), much bigger than the company’s previous calculations of between 18 million and 45 million boe. The discovery will significantly enhance Aker BP’s resource base for the Yggdrasil development, which previously was estimated at 650M gross boe. The oil discovery is located within production licenses 873 and 442: In license 873, with Equinor and PGNiG Upstream Norway, a subsidiary of Polish state owned energy company PGNiG, as partners. The plan for development and operations for this project was submitted to Norwegian authorities in December 2022, with production scheduled to start in 2027.

The North Sea is home to considerable amounts of known oil and gas reserves. Norway’s Oil and Gas Authority says known reserves of oil and gas in the region at the end of 2020 amounted to 4.4 billion boe.

According to Oil and Gas Authority’s Vision 2035, taking into account future exploration, 14.9 billion boe could potentially be extracted between now and 2035. The figures in Vision 2035 were based on an assumption of an oil price of $60 per barrel of oil and 55 pence per thermal unit of gas. With current oil prices, it should be economic to continue production in the North Sea as per the agency’s estimates. The industry has been able to lower drilling costs considerably since the oil slump of 2014.

The UK government is currently weighing whether to approve a giant new oil and gas field in the North Sea, despite warnings from climate scientists and energy economists against any new fossil fuel projects. The Rosebank oilfield has the potential to produce 500m barrels of oil over its lifetime

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Germany Takes Control of Russian Owned Schwedt Refinery

German government decided to take control of Russian owned Schwedt oil refinery on Friday, as Berlin scrambles to shore up energy supplies and meet commitment to the European Union to eliminate Russian oil imports by the end of the year. The move could meet a retaliatory response from Moscow. Germany’s economy ministry announced it was putting Schwedt refinery, owned by a unit of Russian oil company Rosneft, under trusteeship of the industry regulator. The refinery supplies 90% of Berlin’s fuel. 

Biden Administration Stuck Between EV Target and Environmental Pressure

The United States has reserves of lithium, copper and other metals to produce millions of electric vehicles (EVs), but opposition from environmental groups to new mines may force it to rely on imports and delay the Biden administration’s effort to phase out gas powered vehicles. 

Russia Plans to Spend $34 Billion from National Wealth Fund

Russia plans to spend about 2.5 trillion roubles ($34 billion) from the National Wealth Fund (NWF) in the next three years to spark economic growth that was hit by the pandemic. However, a possible hike in inflation rate as a result of the spending will be a challenge for the country. The figure means there is a considerable increase from the government and central bank’s earlier agreement that the spending would be 1.6 trillion roubles.

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