Page 13 - EurOil Week 49

EurOil INVESTMENT EurOil

Halo exits Pegasus gas project

UK DUTCH oil and gas explorer Hague and as “the ongoing commitments and costs did not
London Oil (HALO) is backing out of the meet the company’s requirements or strategy in
The project has not Pegasus development in the southern North the absence of any commercial solutions for the
settled on an export Sea, citing the “increasingly risky” nature of GPA.”
route. the project. HALO took a 45% position at GPA, which
Progress at Pegasus was derailed last year after comprises the Andromeda, Pegasus West and
Spirit entered a dispute with Neptune Energy other discoveries, in September 2018, through
over the prioritisation of capacity at the latter’s the purchase of Third Energy Offshore.
Cygnus Alpha platform. Spirit had wanted to The company also cited disappointing results
hook Pegasus up to Cygnus Alpha. at the Andromeda North well last year as a factor
As a result, a final investment decision (FID) behind its decision. The partners found gas but at
on the project expected in April last year was the “lower end of expectations,” and the reservoir
never taken. was found not to be in contact with the adjacent
UK upstream regulator Oil and Gas Author- Pegasus West discovery. They had been targeting
ity (OGA) sought to resolve the dispute, only to 40bn cubic feet (1.13bn cubic metres).
advise Spirit to seek out alternative export routes HALO added that it “prefers to focus its cap-
for Pegasus. But the operator has not settled on ital and efforts now on projects which are lower
an option. cost, lower risk, higher return and closer to infra-
HALO said in a statement on December 7 that structure within already agreed partnerships.” It
it had “decided to fully relinquish its equity par- referred to its Schooner and F5 project in the
ticipation in the Greater Pegasus Area (GPA)”, southern North Sea as an example.™

Aker BP’s Hod redevelopment

cleared by authorities

NORWAY NORWEGIAN authorities have greenlit Aker only 20% of its resources had been recovered.
BP’s plan to redevelop and operate the Hod The field is due to be redeveloped using a
Aker BP plans to field in the Norwegian North Sea, the operator normally unmanned installation remotely con-
invest $600mn in announced on December 8. trolled from the Valhall field centre. Its emissions
redeveloping Hod. Aker BP submitted the paperwork to Nor- are very low, as it is powered from the shore.
way’s Energy Ministry back in June to invest Aker BP has a 90% interest in the project, while
$600mn in redeveloping Hod, to recover 40mn Pandion Energy holds 10%.
barrels of oil equivalent (boe) in reserves. Pro- Aker BP, whose main shareholders are BP
duction is due to start up in the first quarter of and Norwegian investment firm Aker, also
2022. brought on stream the Aerfugl gas field this year,
In a statement, Aker BP said Hod would where it is targeting 4.2bn cubic metres per year
be the first project to benefit from a tax relief of gas supply. ™
package approved by Norway’s parliament in
the summer, aimed at encouraging operators to
continue investing despite the global oil market
downturn. In April, at the height of the coronavi-
rus (COVID-19) induced oil crisis, Aker BP had
said it would freeze all unsanctioned projects,
including Hod.
The company said it had already awarded
some 100 contracts worth above NOK1mn
($110,000) each to suppliers in nine Norwegian
counties for Hod, highlighting the project’s eco-
nomic impact.
Hod was in production between 1990 and
2012, when it was judged to be uncommercial to
continue flowing oil without additional invest-
ment. At the time of its closure, it is estimated that

Week 49 10•December•2020 www. NEWSBASE .com P13