Statoil Finds Little at Latest Barents Sea Well

songa
The Arctic Sunrise and the Songa Enabler at the Korpfjell site, August 2017 (Greenpeace)

By MarEx 2017-08-31 19:57:19

Norwegian state-owned oil firm Statoil has struck out at its much-anticipated and controversial Korpfjell well in the Barents Sea. 

Like the last well in Statoil’s 2017 Barents campaign, Korpfjell contains only "non-commercial" quantities of natural gas, according to the Norwegian Petroleum Directorate. Statoil's team drilled down to about 5,000 feet, and they encountered a 100-foot gas column with reserves estimated in the range of 6-12 billion cubic meters. The amount is not commercially recoverable, and Statoil will plug and abandon the well. Statoil’s rig – the harsh environment floater Songa Enabler – will move on to the fourth of its five drill sites in the Barents for this season. 

Korpfjell’s geologic structure looked promising, and Statoil had hoped to find large reserves of oil. However, it is above the Arctic Circle, and some critics contend that it is unsafe for Statoil to explore in such high latitudes. The firm notes that the area is ice-free during the drilling season and that its activities have a risk profile roughly comparable to drilling in the North Sea. 130 wells have already been drilled in the Barents –including Eni's Goliat find and Russia's Prirazlomnoye field, the first Arctic offshore oil development to enter production. 

Environmental group Greenpeace has protested all of these projects, and the authorities have occasionally responded with enforcement actions. Greenpeace activists in kayaks protested near Songa Enabler while it was moored off the Norwegian mainland this February, and again at the well site at Korpfjell in August. During the most recent protest, the activists entered a 500-meter exclusion zone around the rig. After they refused to leave, the Norwegian Coast Guard removed them from the area – raising a legal dispute over the ability of a sovereign government to interfere with navigation in international waters. Korpfjell is within Norway's EEZ boundaries, but not within its territorial seas, and Greenpeace contended that UNCLOS does not allow Norway to "infringe or unjustifiably interfere with our freedom of navigation." Norwegian authorities did not agree, and they took the Greenpeace vessel Arctic Sunrise in tow for a voyage to Tromso, the nearest mainland port. 

The vessel arrest was the second for the Sunrise related to an Arctic drilling campaign. The Dutch-flagged ship was boarded and detained by Russian federal security officers in September 2013 during a protest at Gazprom's Prirazlomnaya well. 30 crewmembers were arrested and held for months, and the ship wasn't returned to Greenpeace until the next summer. The Permanent Court of Arbitration in the Hague awarded Dutch flag state authorities $6 million for wrongful arrest and damages; if any of the award is recovered, the Netherlands says that it will transfer it to Greenpeace.