OSLO, Sept 19 (Reuters) – Norway’s Equinor (EQNR.OL) and its partners said on Tuesday they had increased the estimated cost of their oil field project by almost 13 billion Norwegian crowns ($1.20 billion). common Johan Castberg, in the Arctic Barents Sea. .
“Costs are increasing due to a larger than expected scope of work and increasing costs in the industry,” Equinor said in a statement.
The planned start of production from the field has been maintained for the fourth quarter of 2024 and production is expected to last around 30 years, Equinor said.
The updated cost estimate for the project now stands at 80 billion Norwegian crowns, an increase of almost 13 billion since last year and compared to the 57 billion initially forecast when the Castberg development began in 2017, Equinor said.
The Castberg floating production, storage and offloading (FPSO) vessel is designed to produce nearly 190,000 barrels of oil per day from the field and is considered profitable at oil prices above $35 per barrel, a added the company.
Crude oil is currently trading at around $95 per barrel.
Equinor has a 50% stake in the development while Eni’s (ENI.MI) Norwegian unit Vaar Energi (VAR.OL) owns 30% and state oil company Petoro has 20%.
($1 = 10.8150 Norwegian crowns)
Reporting by Terje Solsvik; Editing by Anna Ringstrom and Muralikumar Anantharaman
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