Multibillion-pound plans for a new North Sea oil field that would have created hundreds of jobs have been postponed.
Statoil announced last night that it was putting plans for the Bressay field on hold for now – because it thinks it can find a cheaper way to get at the oil.
The company had planned to drill up to 70 production wells on the field, following a similar approach to the planned development for the neighbouring Mariner field.
It was targeting up to 300million barrels from the heavy oil field, with as many as 500 jobs being created by the project once it goes ahead.
First oil was expected from the field – south-east of Shetland – in early 2018, but that would now appear to be in doubt.
A spokesman for Statoil confirmed the delay in a statement yesterday.
“Based on a recommendation from the Bressay licence group (Statoil 81.625%, Shell 18.375%) Statoil has decided to re-evaluate the development concept for the Bressay field and to delay the field development decision,” he said.
“Interpretation of extended well-test data from the nearby Bentley field, a close analogue to Bressay, has given positive indications that there is potential to simplify the concept and investigate alternative and more cost-efficient development solutions.
“This will also involve reconsideration of the overall execution and procurement strategy for Bressay and re-engagement with the contractor market.
“We are in good dialogue with the UK Department of Energy and Climate Change and a decision to delay the project to improve the development concept will require an agreement with DECC and a further licence extension to allow planning and execution within an agreed timeline.”
He added: “The project will continue its efforts to increase the value of the business case through improvements in the reservoir drainage plan, simplifying the production facilities and reviewing the project execution and contract strategy.
“The delayed decision for Bressay has no implications for Mariner project.”
Jeremy Cresswell, editor of the Press and Journal’s Energy supplement, said: “In essence, Bressay was expected to be a clone of the Mariner field development now under way.
“However, Statoil has always been clear that it would apply lessons and ideas garnered from Mariner to guide the manner in which Bressay is ultimately developed.”
Earlier this year Statoil, led by Helge Lund, announced similar delays to the proposed development of the Johan Castberg field in the Barents Sea in order to look at simpler proposals for the prospect.