Statoil Halts Huldra Production - Analyst Blog
15 September 2011 - 12:00AM
Zacks
Statoil ASA’s
(STO) production was hit hard by a fire that broke out at its
Huldra platform in the North Sea. The company said that the fire
was spotted in an air compressor compartment on the platform,
situated west of Mongstad.
While none of the 19 persons on
board were injured, gas and condensates production was halted in
the Huldra as a preventive measure. Statoil reaffirmed that
activities will resume once the situation normalizes. The cause of
the incident is yet to be explained.
Located in blocks 30/2 and 30/3,
the Huldra platform lies about 16 kilometers from Veslefrikk. Gas
from Huldra is shipped through a 140-kilometre line to the Heimdal
field for processing and subsequent transmission to continental
Europe.
Statoil owns 19.88% share in the
Huldra platform. Other associate partners are
ConocoPhillips (COP) with 23.34%, Total
SA (TOT) with 24.33%, Talisman Energy Inc
(TLM) with 0.5% and state-owned Petoro with 31.96% interests. The
Norwegian oil company, Statoil and its partners were looking to
deliver 1,000 barrels of oil daily at Huldra and 0.46 billion cubic
meters of gas this year, per the Norwegian Petroleum
Directorate.
Although Statoil is facing
production glitches of late, it is continuously shifting its focus
to the still-unexplored areas of the Norwegian Sea, and intends to
recover 4.2 billion barrels of oil equivalent in the coming years.
This will enhance the company’s volume growth prospects going
forward. Management is targeting an oil recovery rate of 50% by
2020.
Statoil expects steady or lower
equity production in 2011 compared with 2010. Management also said
that it would deliver a compound annual production growth rate of
around 3% between 2010 and 2012. It also expects maintenance to
have a negative impact of around 70 thousand barrels of oil
equivalent per day (MBOE/d) on equity production in the third
quarter and of 50 MBOE/d in 2011, of which most are liquids.
Our long-term Neutral
recommendation remains unchanged and the company holds a Zacks #3
Rank (short-term Hold rating).
CONOCOPHILLIPS (COP): Free Stock Analysis Report
STATOIL ASA-ADR (STO): Free Stock Analysis Report
TALISMAN ENERGY (TLM): Free Stock Analysis Report
TOTAL FINA SA (TOT): Free Stock Analysis Report
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