## Equinor and partners bring North Sea giant Johan Sverdrup on stream early and below budget

##### 07 October 2019

Equinor and the Johan Sverdrup partnership consisting of Lundin Norway, Petoro, Aker BP and Total, have started production from the giant field in the North Sea, more than two months ahead of and NOK 40 billion (US4.4 billion) below the original estimates in the Plan for development and operation.

Johan Sverdrup has expected recoverable reserves of 2.7 billion barrels of oil equivalent and the full field can produce up to 660,000 barrels of oil per day at peak. Powered with electricity from shore, the field has record-low CO2 emissions of well-below 1 kg per barrel.

The water depth is 110-120 meters; the reservoir contains sandstone from the Jurassic period, and lies at about 1900 meters depth.

Johan Sverdrup coming on stream is a momentous occasion for Equinor, our partners and suppliers. At peak, this field will account for around one third of all oil production in Norway and deliver very valuable barrels with record low emissions. Johan Sverdrup is expected to generate income from production of more than NOK 1400 billion of [US$154 billion] which more than NOK 900 billion [US$99 billion] to the Norwegian state and society.

—Eldar Sætre, president and CEO of Equinor

The break-even price for the full-field development is less than US$20 per barrel. After reaching plateau for the first phase, anticipated during the summer of 2020, expected operating costs are below US$2 per barrel. The operator also expects cash flow from operations of around US$50 per barrel in 2020, based on a real oil price of US$70 per barrel, partly as a result of the phasing of tax payments in the ramp-up phase.

The oil from the field will be piped to the Mongstad terminal in Hordaland. The gas will be transported to Statpipe and on to Kårstø processing plant in North Rogaland.

Starting production months ahead of schedule helps realize additional value from the field and is fitting for a project that over the development phase has redefined excellence in project execution.

—Anders Opedal, executive vice president for Technology, projects & drilling in Equinor

The Plan for development and operation (PDO) for Johan Sverdrup phase 1 set an ambition for production start-up in late December 2019. Since the PDO was approved in August 2015, investment costs for the first phase of the development have been reduced by NOK 40 billion to now NOK 83 billion (US\$9.1 billion) (nominal NOK, fixed exchange rate).

The qualification of new installations technology has reduced safety risk, saved more than two million offshore hours and shaved months of the development schedule. We have also invested in digital solutions and ways of working to boost oil recovery, optimize production and improve field operations, and these new ways of working have already saved at least one month in the execution stage.

—Anders Opedal

Sanctioning of Johan Sverdrup in 2015 led the way to the largest development on the Norwegian Continental Shelf (NCS) since the 1980s. The first phase of the development has taken above 70 million manhours, and more than 12,000 people worldwide worked every day during the main construction period 2016-2018.

More than 70% of the contracts were awarded to suppliers in Norway, in strong international competition. The consultancy Agenda Kaupang has estimated that the Johan Sverdrup development can contribute more than 150,000 man-years in Norway during the construction phase between 2015-2025.

In the operations phase expected to last more than 50 years, Johan Sverdrup may also generate employment of more than 3,400 man-years on average every year.

The Johan Sverdrup field is being developed in two phases. Phase II of the development was approved by Norwegian authorities in May 2019 with production start-up expected in Q4 2022.