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OIL AND GAS
No luck for Tullow south of Johan Sverdrup
by Daniel J. Graeber
Oslo, Norway (UPI) Jul 11, 2016


disclaimer: image is for illustration purposes only

A well drilled about 20 miles from the Johan Sverdrup oil field, the fifth largest discovered off the Norwegian coast, came up empty, a regional authority said.

A subsidiary of Tullow Oil, which lists its headquarters in London, drilled into a well about 18 miles south of the Johan Sverdrup oil field in the central waters of the North Sea.

The Norwegian Petroleum Directorate, the nation's energy regulator, said this was the first well ever drilled into an area demarcated as license area 776. The NPD said the objective was to prove petroleum reserves, though it came up dry.

"The well will now be permanently plugged and abandoned," the regulator said.

Norwegian energy company Statoil and its developmental partners are looking to a 2019 start date for Johan Sverdrup, billed as one of the largest fields ever discovered in Norwegian waters. Once in full swing, the field should account for up to 25 percent of all Norwegian petroleum production.

Tullow is not a party to the Johan Sverdrup project consortium.

Tullow entered the year with an announcement to cut its spending plans from $1.7 billion to $1.1 billion in 2016 and was looking to scale back even further. In its latest update, it said it was reducing its capital spending forecast from $1.1 billion to $1 billion.

In March, Moody's Investors Service said the company may recover on the back of the planned mid-2016 start up of it oil projects off the West African coast.

There was no statement on the North Sea drilling campaign from the Tullow subsidiary.


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