StatoilHydro focuses on costs on Norwegian shelf

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by Patrick Mcloughlin

StatoilHydro is continuing its push for lower costs and better quality production at its Norwegian shelf operations, the Norwegian major told an industry conference in the country’s oil capital of Stavanger.

A StatoilHydro executive for its development of offshore projects, Bard Heimset, told the Modifications Conference 2009 organised by Offshore Media Group, that half of the projects StatoilHydro is now working with are at break-even with current oil prices.

“If the oil price were constant then we must we must do something with cost levels,” Heimset told the conference.

A cost reduction of 25% would correspond to around $4 in oil prices, a solid achievement, he added.

“The collapse in the oil price is an important concern, but what is new is the combination of low oil prices and increased costs,” he said.

“This means that the margins are smaller and that we must focus on quality and doing things right the first time,” he added.

In 2008 we produced 1.9 million barrels per day and will produce 2.2 million barrels in 2012 the executive said.

“We must have a growth on an NCS, to attend to the 5% production decline,” he said.

“We must also live by the old, becoming more connected to existing infrastructure and upgrading old fields,” Heimset added.

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