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Norway still holds huge natural gas reserves, which exploration and production companies should pursue to unlock and “leave no stone unturned” in determining if it is profitable to produce with current technology, the Norwegian petroleum regulator said on Wednesday.
Much of the natural gas reserves remaining on the Norwegian Continental Shelf are located in tight reservoirs with low permeability, which makes them more difficult to produce, the Norwegian Petroleum Directorate (NPD) said.
The regulator, however, urged companies “to "leave no stone unturned" and determine if it is possible to produce remaining resources in a profitable way by utilising existing technology.”
“Despite the significant uncertainty associated with how much gas we're talking about, the cost level and future gas prices, our calculations show that the values involved are substantial," said Arne Jacobsen, NPD Assistant Director of Technology, analyses and coexistence.
“It's often expensive to implement technology, and profitability can be marginal. We encourage the companies to think outside the box and work across fields – and thereby achieve potential economies of scale,” Jacobsen added.
Earlier this week, the regulator said that a mapping of resources it had conducted showed that about 65% of all gas resources on the Norwegian shelf have not yet been produced.
“Identifying which gas resources are difficult to develop, and what's needed to ensure that the resources are produced, gives us a sound basis for dialogue and potential measures along with the industry so that these resources can be recovered,” Kjersti Dahle, the NPD's Director for Technology, analyses and coexistence, said in a statement.
Norway is boosting its natural gas production as much and as fast as it can, to deliver more gas to Europe, which is starting a second consecutive winter with severely reduced Russian pipeline gas supply.
Last month, for example, Equinor announced a new commercially viable gas discovery near a producing field that can be brought online and deliver gas to Europe as early as this year.
By Charles Kennedy for Oilprice.com
Charles is a writer for Oilprice.com