Norway’s Biggest Oil Find in Decades May Yield 70% Recovery Rate

Norway’s Johan Sverdrup discovery, the country’s largest oil find in decades, could achieve a recovery rate of as much as 70 percent, according to the field’s operator, Statoil ASA. (STL) Shares in partners Lundin Petroleum AB and Det Norske Oljeselskap ASA (DETNOR) surged.

“This is very, very good oil and the reservoir is good,” Margareth Oevrum, Statoil’s executive vice president for technology, projects and drilling, said in a presentation in London today. “If we work with that over the lifetime, we can manage to get almost a 70 percent recovery rate.”

Current resource estimates for Sverdrup, which may be Norway’s biggest since Statfjord in 1974 and the third-largest ever, don’t take into account a 70 percent recovery rate, she said. Oevrum declined to say what rate Statoil used for its latest estimates for Sverdrup.

Discovered in two parts by Lundin Petroleum AB (LUPE) in 2010 and Statoil in 2011, Sverdrup renewed optimism in Norway’s oil industry after a decade of falling output from aging North Sea fields. The oil discovery could supply as much as 25 percent of Norway’s oil production 10 years from now, the Norwegian Petroleum Directorate said last month.

Statoil estimated in December that Sverdrup holds as much as 2.9 billion barrels of oil equivalent even as it cut its resource estimate and delayed the start of output by a year.

Shares in Lundin and Detnor, which both have stakes in Sverdrup, climbed after Oevrum’s comments. Lundin gained as much as 5.4 percent to 127.3 kronor, the highest intraday level in more than a month, and traded 4.1 percent higher at 4:25 p.m. in Stockholm. Detnor climbed as much as 5.2 percent, the most in a year, and traded 4.2 percent higher at 67.6 kroner at the same time in Oslo.

To contact the reporter on this story: Mikael Holter in Oslo at mholter2@bloomberg.net

To contact the editor responsible for this story: Jonas Bergman at jbergman@bloomberg.net

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