Azernews.Az

By Bloomberg

Statoil ASA postponed decisions past this year on whether to continue with two oil projects off Norway as the state-controlled company deepens cost cuts amid the fall in crude prices.

Statoil and its partners delayed a decision about whether to continue with the Johan Castberg field development in the Barents Sea until the second half of 2016 and now sees an investment decision in 2017, it said in a statement Friday. The producer also postponed a preliminary “decision to implement” for the Snorre 2040 project in the North Sea until the fourth quarter of 2016, Statoil said.

“The Johan Castberg license has achieved significant cost- reductions in recent years but the companies see further potential,” the Stavanger-based company said. More time is also needed for the owners of Snorre 2040 to curb investment costs and gain more understanding about the reservoir, it said.

Statoil last month followed competitors such as BP Plc and Chevron Corp. in cutting spending plans to protect returns after oil prices declined by about half since June. Norway Petroleum & Energy Minister Tord Lien has warned Snorre 2040 is more “time- critical” than other ventures such as new developments.

Proven volumes in Johan Castberg are estimated at 400 million barrels of oil to 650 million barrels of oil while the Snorre field reserves are estimated at 1.63 billion barrels of oil, Statoil said.

Statoil said last month it will deepen cost cuts by 30 percent to $1.7 billion from 2016 and lower capital expenditure to $18 billion this year from a prior target of $20 billion.