Lundin: North Sea Oil Find Luno II May Hold 160M Barrels

OSLO - Swedish oil company Lundin Petroleum AB estimated that its Luno II discovery off Norway could yield as much as 160 million barrels, the latest in a string of finds that have revived interest in the North Sea.

It was the first indication of the size of the find, and the market was slightly disappointed.

Lundin said it expects the southern part of Luno II to contain between 25 million and 120 million barrels of oil equivalent. Another section to the north could produce between 10 million and 40 million barrels, the company said.

Lundin shares fell 2.2% to trade at SEK152.00 after the announcement, reflecting both uncertainty about the exact size of Luno II and the announcement Sunday of an increase in oil company taxes in Norway.

Luno II is located in a geological formation in the middle of the North Sea called the Utsira High. This is where Lundin discovered the Edvard Grieg in 2007 and the Johan Sverdrup in 2010, both significant finds.

"We are pleased to announce another significant discovery in the Utsira High region, which in terms of size and location is likely to be commercial," said Lundin chief executive Ashley Heppenstall.

Lundin's recent success on the Utsira High has contributed to renewed interest in the North Sea, where most companies thought there was nothing left to find after four decades of oil activity.

Statoil recently reported the discovery of between 40 million and 150 million high-value barrels near Gullfaks, a nearly depleted field in the northern North Sea where production began in the mid-80s.

Mr. Heppenstall said the company continues to explore Utsira High and said he was optimistic about further discoveries.

Lundin is the operator of production license 359 where Luno II was found, with a 40% ownership stake. Statoil ASA and Premier Oil Plc each have a 30% stake in the field.

Copyright (c) 2013 Dow Jones & Company, Inc.

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Lundin Reports Dry Well in North Sea

Sweden's Lundin Petroleum reported Friday that its wildcat well 16/1-17, targeting the Jorvik prospect in the North Sea, has come up dry.

The well, located approximately 3 miles east of well 16/1-8 (the Edvard Grieg discovery well), was drilled with the objective of proving petroleum in Pre-Jurassic sandstone and conglomerate rocks.

Liquid samples acquired from the well did show mobile oil in a dense reservoir section. But despite core samples taken from this section that showed oil, Lundin said it has not been possible to establish an oil gradient and the well has been classified as dry.

Lundin, as operator, has a 50-percent working interest in production license PL338, where the Jorvik target is located. Partners include Wintershall Norge, with a 30-percent interest, and OMV, which has a 20-percent interest.

Well 16/1-17 was drilled by the Transocean Winner (DW semisub) rig, which will now proceed to production license 036 D where Marathon Oil Norge is the operator.

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Lundin Reports Dry Well in North Sea

Sweden's Lundin Petroleum reported Friday that its wildcat well 16/1-17, targeting the Jorvik prospect in the North Sea, has come up dry.

The well, located approximately 3 miles east of well 16/1-8 (the Edvard Grieg discovery well), was drilled with the objective of proving petroleum in Pre-Jurassic sandstone and conglomerate rocks.

Liquid samples acquired from the well did show mobile oil in a dense reservoir section. But despite core samples taken from this section that showed oil, Lundin said it has not been possible to establish an oil gradient and the well has been classified as dry.

Lundin, as operator, has a 50-percent working interest in production license PL338, where the Jorvik target is located. Partners include Wintershall Norge, with a 30-percent interest, and OMV, which has a 20-percent interest.

Well 16/1-17 was drilled by the Transocean Winner (DW semisub) rig, which will now proceed to production license 036 D where Marathon Oil Norge is the operator.

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Lundin Spuds Luno II Well

Sweden's Lundin Petroleum has spud its exploration well 16/4-6S, targeting the Luno II prospect, located south of the Edvard Grieg field in the Norwegian North Sea, the company announced Tuesday.

Lundin said the main objective of the well is to prove the presence of hydrocarbons in Jurassic reservoir sandstones. The firm estimates the Luno II prospect contains un-risked prospective resources of some 139 million barrels of oil equivalent.

The planned total depth of the well is approximately 6,890 feet below mean sea level and the well will be drilled using the Bredford Dolphin (mid-water semisub) rig.

Lundin is the operator of production license 359, where Luno II is located. It has a 40-percent interest in the license, while Statoil and Premier Oil each have a 30-percent holding.

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Lundin Strikes Oil Offshore Malaysia

Lundin Petroleum, through its wholly owned subsidiary Lundin Malaysia BV, announced Monday that it has discovered oil in the Ara-1 well that was drilled in Block PM308A, offshore Peninsular Malaysia.

Ara-1 was drilled to a total depth of 13,221 feet (4,030 meters) by the jackup West Courageous (350' ILC) in 246 feet (75 meters) water depth. The objective of the well was to target the extension of the Paleogene intra-rift oil sands that had been encountered in the Janglau-1 well drilled by Lundin in 2011.

Ara-1 encountered 9 thin oil-bearing sands in a high-pressured intra-rift section extending over a vertical interval of 2,624 feet (800 meters).

The well confirmed the extension of the new intra-rift oil play across a very large structural complex in the northeast of PM308A below a major regional seal. The well also found effective sand reservoirs at depths below 11,482 feet (3,500 meters). The oil pay zones intersected by Ara-1 were however individually thinner than pre drill expectation.

Ara-1 was plugged and abandoned as an oil discovery well after completion of the well evaluation programme. Work has commenced to estimate the range of resources discovered.

Lundin intends to incorporate the well results into the recently extended regional 3D seismic data set to identify areas where local sand reservoir sources may be better developed and can high grade future drilling prospects.

The West Courageous jackup rig will be demobilized following completion of Ara-1, the final well of Lundin's 2012 drilling campaign.

The PM308A production sharing contract (PSC) is operated by Lundin Malaysia BV with 35 percent equity interest. Partners are JX Nippon Oil & Gas Exploration (Peninsular Malaysia) Limited with 40 percent and PETRONAS Carigali with 25 percent.

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Lundin Spuds Jorvik Exploration Well

Lundin Petroleum announced Monday that it has spud an exploration well targeting its Jorvik prospect in the Norwegian North Sea. Well 16/1-17, on production license 338, is located east of the Edvard Grieg field.

The main objective of well 16/1-17 is to prove the presence of oil-bearing sandstones and conglomerates in a basin directly east of Edvard Grieg. Lundin estimates that the Jorvik prospect contains un-risked, gross prospective resources of 46 million barrels of oil equivalent. Lundin, as operatorm, holds a 50-percent working interest in PL 338 while Wintershall Norge and OMV hold 30 percent and 20 percent respectively.

On a day that the Swedish company made a number of announcements, Lundin also revealed that it is to test appraisal well 16/3-5 on production license 501 in the southeastern part of the Johan Sverdrup discovery after it reached its target depth.

Lundin said the appraisal well has drilled through reservoir sections consisting mainly of good quality Volgian reservoir sand and Zechstein carbonates. The top of the Volgian reservoir sandstone was found at 6,210 feet below mean sea level. The total gross reservoir column is approximately 98 feet, of which 46 feet is gross Volgian reservoir.

The oil-bearing Zechstein limestone is in pressure communication with the overlying sand and provides potential upside resources, according to Lundin. Oil has been sampled in both reservoir zones and the well will now drill stem test the two zones.

The well is being drilled by the Bredford Dolphin (mid-water semisub) rig and the testing will take approximately 20 days.

Meanwhile, Lundin added that it will not provide further updates on contingent resources at the Johan Sverdrup discovery since the working operator for the field, Statoil, has indicated that it plans to release details of updated resources later in the year, once conceptual development studies are completed.

"We feel it is appropriate that the working operator of Johan Sverdrup provide updated resource numbers. As the operator of PL501 we continue with our appraisal drilling program which provides new information for both development planning and recoverable resources," Lundin CEO Ashley Heppenstall commented in a company statement.

"The results of the appraisal drilling to date taken as a whole lead us to the view that the current most likely mid case Johan Sverdrup resources located in PL501 will be within the lower half of the previously guided 800-to-1800 million barrel of oil equivalent range. We also believe that the resource calculation range remains wide."

A former engineer, Jon is an award-winning editor who has covered the technology, engineering and energy sectors since the mid-1990s. Email Jon at jmainwaring@rigzone.com.

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Lundin Spuds Jorvik Exploration Well

Lundin Petroleum announced Monday that it has spud an exploration well targeting its Jorvik prospect in the Norwegian North Sea. Well 16/1-17, on production license 338, is located east of the Edvard Grieg field.

The main objective of well 16/1-17 is to prove the presence of oil-bearing sandstones and conglomerates in a basin directly east of Edvard Grieg. Lundin estimates that the Jorvik prospect contains un-risked, gross prospective resources of 46 million barrels of oil equivalent. Lundin, as operatorm, holds a 50-percent working interest in PL 338 while Wintershall Norge and OMV hold 30 percent and 20 percent respectively.

On a day that the Swedish company made a number of announcements, Lundin also revealed that it is to test appraisal well 16/3-5 on production license 501 in the southeastern part of the Johan Sverdrup discovery after it reached its target depth.

Lundin said the appraisal well has drilled through reservoir sections consisting mainly of good quality Volgian reservoir sand and Zechstein carbonates. The top of the Volgian reservoir sandstone was found at 6,210 feet below mean sea level. The total gross reservoir column is approximately 98 feet, of which 46 feet is gross Volgian reservoir.

The oil-bearing Zechstein limestone is in pressure communication with the overlying sand and provides potential upside resources, according to Lundin. Oil has been sampled in both reservoir zones and the well will now drill stem test the two zones.

The well is being drilled by the Bredford Dolphin (mid-water semisub) rig and the testing will take approximately 20 days.

Meanwhile, Lundin added that it will not provide further updates on contingent resources at the Johan Sverdrup discovery since the working operator for the field, Statoil, has indicated that it plans to release details of updated resources later in the year, once conceptual development studies are completed.

"We feel it is appropriate that the working operator of Johan Sverdrup provide updated resource numbers. As the operator of PL501 we continue with our appraisal drilling program which provides new information for both development planning and recoverable resources," Lundin CEO Ashley Heppenstall commented in a company statement.

"The results of the appraisal drilling to date taken as a whole lead us to the view that the current most likely mid case Johan Sverdrup resources located in PL501 will be within the lower half of the previously guided 800-to-1800 million barrel of oil equivalent range. We also believe that the resource calculation range remains wide."

A former engineer, Jon is an award-winning editor who has covered the technology, engineering and energy sectors since the mid-1990s. Email Jon at jmainwaring@rigzone.com.

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Lundin Expects to Produce up to 38,000 boepd in 2013

Sweden's Lundin Petroleum said Monday that it expects to produce between 33,000 and 38,000 barrels of oil equivalent (boepd) per day during 2013.

Releasing an update on its 2P reserves, Lundin CEO Ashley Heppenstall said that the firm expects to exit 2013 with a production rate of 40,000 boepd after its Brynhild field, offshore Norway, comes on stream later this year.

Lundin's 2P reserves are now 201.5 million barrels of oil equivalent, which is down from the 210.7 million barrels reported for the end of 2011. The firm said its 2P reserves have been positively affected by its Bertam field, offshore Malaysia, which has been added to the figure. Further increases resulted from Lundin's main producing assets – the Alvheim and Volund fields, offshore Norway – as well as the Brynhild field.

However, Lundin pointed out that these additions were offset by reserves reductions predominantly on the Gaupe gas/condensate field offshore Norway and producing assets in the Komi Republic in northern Russia.

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