Lundin Petroleum Finds New Oilfield in Norwegian North Sea

Lundin Petroleum AB discovered oil in Norway’s North Sea, claiming a new field in an area that yielded one of the country’s largest recent finds.

The Luno II exploration well discovered oil-bearing sands with a 40-meter (130-foot) column of “good quality” crude, the company said today in a statement. “Luno II appears to be another significant discovery,” Chief Executive Officer Ashley Heppenstal said.

Lundin, which holds 40 percent of the license, also owns a stake in the eastern half of the Johan Sverdrup field, which is potentially the biggest find off Norway since 1974. That deposit, which may hold as much as 3.6 billion barrels of oil, has revived interest in exploring the country’s coastal waters.

Lundin rose 3.6 percent to close at 145.6 kronor in Stockholm trading. The company operates the Luno II license, while U.K. explorer Premier Oil Plc and Norway’s Statoil ASA hold 30 percent each.

“The reservoir quality, whilst not the same as Johan Sverdrup, appears good and will now be tested,” Lundin said.

The Stockholm-based company, which had previously given an estimate of unrisked, gross, prospective resources of 139 million barrels of oil equivalent for Luno II, expects to announce recoverable resources within three weeks.

Based on Lundin’s estimates before drilling, the discovery may be valued at 5 kronor to 7 kronor a share for the company and 0.35 kroner to 0.45 kroner a share for Statoil, Swedbank First Securities said in a note to clients. The broker, which recommends buying both stocks, said it expects Lundin to make more finds in the area.

“With the company’s long-term hit ratio of 50 percent, we think several discoveries in this area are likely,” said Teodor Sveen Nilsen, an analyst at Swedbank.

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