Statoil to triple North America oil and gas output

Wed Jun 20, 2012 4:44pm EDT
 
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By Selam Gebrekidan and Edward McAllister

NEW YORK (Reuters) - Norway's Statoil (STL.OL: Quote) aims to triple its North American oil and natural gas production by the end of the decade as it increases spending in oil-rich prospects, the company said on Wednesday.

The state-controlled company, which increased its global capital spending to $17 billion this year, expects to produce 500,000 barrels of oil equivalent a day (boepd) in North America by 2020, up from the 149,000 boepd produced in the first quarter of this year, as it moves away from barely profitable natural gas fields to concentrate on more lucrative liquids-based acreage.

The majority of the increases in North America will come from U.S. operations focused in the Marcellus, Eagle Ford and Bakken shale plays, said Bill Maloney, president of Statoil North America. Some 100,000 boepd will be produced from offshore assets in the deep water Gulf of Mexico, double today's output, the company said during a presentation to investors in New York.

"The resource base in North America has grown well above 6 billion boe, representing around 30 percent of Statoil's total resource base," Maloney said. To grow further, the company is also considering further acquisitions in the region.

Statoil also said it found 100 million to 200 million barrels of recoverable oil equivalent in the Mizzen prospect off Canada's East Coast. The company, which has 65 percent interest and operates the asset, plans to drill two more wells at its discovery this year and next.

Meanwhile, it has entered into a partnership with Canada's PetroFrontier Corp PFC.V to explore for shale gas in Australia, it also announced on Wednesday.

US SHALE

Statoil already saw a 75 percent year-over-year increase in its North American output in the first quarter and is shifting its focus to liquids-rich plays like the Bakken in North Dakota and Montana, where it secured a key position last year with its $4.4-billion acquisition of exploration outfit Brigham Exploration.   Continued...

 
A logo of Statoil is pictured at a petrol station in Warsaw February 5, 2012. REUTERS/Kacper Pempel