Eni’s Norwegian unit to ramp up Arctic drilling

Norwegian subsidiary Vaar Energi said on Thursday it would ramp up exploration in the Arctic Barents Sea to increase its oil

By Reuters September 1, 2023
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The logo of Italian energy company Eni is seen on a booth stand during the Nigeria International Petroleum Summit in Abuja, Nigeria February 11, 2020. Picture taken February 11, 2020. REUTERS/Afolabi Sotunde

OSLO (Reuters) – Eni’s Norwegian subsidiary Vaar Energi said on Thursday it would ramp up exploration in the Arctic Barents Sea to increase its oil and gas production in the region.

Plans by oil companies to explore in the Barents Sea have been criticized by environmentalists, who say it runs contrary to Norway’s international commitments to reduce greenhouse gas emissions.

The country’s Supreme Court, however, rejected a motion to stop Arctic drilling in 2020.

“We see great opportunities for growth and value creation in the Barents Sea,” Vaar’s outgoing CEO Torger Roed said in a statement.

Vaar operates Goliat, the only producing oilfield in the Barents Sea, and is a partner in Equinor’s project to develop the Johan Castberg oilfield, which is expected to start producing at end-2024.

Vaar said the drilling program in the Barents Sea will focus on finding more resources around the two fields over the period 2024-2026.

A spokesperson for the company, however, said he couldn’t provide a number of wells to be drilled yet.

Vaar said it hired the COSLProspector offshore drilling rig China Oilfield Services (COSL), a subsidiary of China state-owned firm CNOOC Group for the drilling program in the Arctic, in cooperation with Norway’s Equinor.

In a separate statement, Equinor said it had awarded COSL contracts for two more rigs, COSLPromoter and COSLInnovator, to drill exploration and production wells.

“We plan to drill many production and exploration wells in the years to come,” Equinor said, without detailing where those wells will be drilled.

Exploration in the Barents Sea was essential to finding new oil and gas resources that could support developing new infrastructure in the region, especially for gas exports, Vaar said.

Today, gas from the only producing gas field, Snoehvit, is exported by tankers following its liquefaction at Hammerfest liquefied natural gas (LNG) plant.

(This story has been refiled to add a dropped word in the headline)

(Reporting by Nerijus Adomaitis, editing by Terje Solsvik)