Vår Energi ASA (OSE: VAR, the "Company") and license partner Kistos Energy Norway AS have reached the final investment decision for the Balder Phase V project in the Balder area. The fast-track development will be a key contributor to sustaining long term production and value creation beyond 2025.
The project will develop 33 million barrels of oil equivalent (mmboe) of gross proved plus probable (2P) reserves for capital spend of USD ~690 million gross and with an attractive breakeven price of around 30 USD per barrel. Drilling will commence in the first half of 2025 and be complete in 2026, with the first wells coming onstream by the end of 2025.
With ongoing development projects coming on stream over the next three quarters, Vår Energi is on track to reach daily production levels of around 400 thousand barrels of oil equivalent per day by the end of 2025. The Company aims to sustain production long term through developing over 20 early phase projects. Balder Phase V is the first of these projects to be sanctioned and the Company expects multiple further project sanctions during 2025.
COO, Torger Rød said: “The Balder area in the North Sea is one of Vår Energi’s core hubs and constitutes significant future resource potential. With the refurbished Jotun FPSO on track to commence production from the field within Q2 2025 we have the tool to unlock additional production. The sanctioning of Balder Phase V aligns with our strategy of maximising value in our core hub areas by utilising existing capacity and infrastructure. I am very pleased to see how the upgraded FPSO will contribute to amplifying value creation from the area with such immediate effect. Beyond Balder Phase V, we are also maturing a Balder Phase VI project ensuring further long-term value creation in the area.”
Balder Phase V involves drilling of up to six infill wells using all the remaining available template well slots in the existing Balder subsea facilities and tied back to the Jotun FPSO for processing. The drilling of multilateral wells has resulted in extending the reservoir area, increased recoverable reserves and recovery factor, reducing the number of wells required.
“The use of advanced multilateral well technology enables targeting high value barrels, with a low breakeven, high rate of return and short time to market, showcasing our value driven approach to applying technology”, Mr Rød ends.
The field is operated by Vår Energi (90%) with Kistos Energy Norway AS as partner (10%).
