Author: Oksana Hillervik

Pandion Energy AS and Wintershall Dea Norge AS have completed their previously announced transaction, whereby Pandion Energy has acquired a 2.5% non-operated interest in PL 820S, comprising the Iving oil and gas discovery announced in 2020, and a 15% non-operated interest in PL 617. Following completion, Pandion Energy holds a 12.5% interest in PL 820S and a 15% interest in PL 617.

PL 820S is located in blocks 25/7 & 8, north-northwest of the Balder and Ringhorne fields. The partnership is currently planning an appraisal campaign to be carried out later this year.

PL 617 is located in block 2/9, east-northeast of the Valhall & Hod fields. Earlier this year, the partnership drilled an exploration well on the Eidsvoll prospect. The well was reported dry.

Related post: 31 December 2020 – Pandion Energy acquires license interests from Wintershall Dea.

Pandion Energy recognises that climate change is of critical importance to the future of the planet and supports the goal of the Paris Agreement to achieve a carbon neutral global economy.

The commitment to carbon neutrality has been achieved initially by offsetting CO2 emissions through programmes that are aligned with the UN Sustainable Development Goals.

Despite the Company’s carbon intensity per produced barrel being one of the lowest in the global E&P industry – ranging from 1.2 – 3.4 CO2e/boe for its net production – Pandion Energy recognises the importance of minimising its carbon impact as swiftly as possible.

Pandion Energy’s approach to maintaining its low carbon impact position is set out in its Strategy to Net Zero Carbon document and includes:

• Pursuing exploration and appraisal opportunities only in areas with existing or plausible future access to renewable energy sources
• Incorporating GHG emissions and the potential for future carbon reduction as a new investment criterion for Development and Production assets
• Incorporating the cost of carbon in evaluating new investments

Pandion Energy aims to align our disclosures with the recommendations set forth by Task Force on Climate-related Financial Disclosures (“TCFD”) from 2021.

CEO of Pandion Energy, Jan Christian Ellefsen says:

A carbon light strategy has always been an imperative for Pandion Energy and our ongoing commitment to carbon neutrality alongside our new investment criteria represents a further positive step in our ambition to achieve Net Zero.

“As the rest of the world starts to move closer to Norway’s leading position on carbon emission reduction, we will continue our work to minimise our footprint and support other players in the sector to do the same.

We also see that further improvements to sharing of environmental data from operators to partners in all licences on the NCS, is an important step to reduce the industry’s climate footprint. Pandion Energy will be working actively towards a common industry standard for sharing and reporting on such data.”

Download Pandion Energy’s full Net Zero Strategy statement.

The APA award was announced by the Minister of Petroleum and Energy, Tina Bru on Tuesday 19 January. For more information about the APA 2020 Licensing Round see Ministry of Petroleum and Energy’s website.

Pandion Energy has been awarded the following licenses:

• License PL 1108 in block 35/9 is located on the Måløy slope, west of the Gjøa field and north-east of the Nova field. Pandion Energy has considerable experience in this area, including the Duva field development project. Pandion Energy has been offered a 30 percent participating interest in PL 1108
• License PL 1119 in blocks 6406/2,3,5 & 6 is located in the central part of the Halten Terrace, adjacent to the Tyrihans Sør, Trestakk and the Lavrans fields, as well as multiple discoveries. Pandion Energy has been offered a 20 percent participating interest in PL 1119.
• License PL 263 F is additional acreage to PL 263 D/E located in the Norwegian Sea. The PL263 D/E license announced a minor gas discovery in exploration well 6407/1-8 S in November 2020. Pandion Energy holds a 20 percent interest in the license.
• License PL 820 SB is additional acreage to PL 820 S, located in the central part of the North Sea, northwest of the Balder and Ringhorne fields. In March 2020, the partnership announced the discovery of oil and gas in exploration well 25/8-19 S, including two sidetracks. Pandion Energy holds a 12.5 percent interest in PL820 S of which a 2,5 percent interest was acquired in December 2020 and is pending completion.
• License PL 891 B is additional acreage to PL 891, located in the central part of the Norwegian Sea, north of Heidrun. In December 2020, the partnership announced a significant oil discovery in exploration well 6507/5-10 S. Preliminary estimates place the size of the discovery between 75 to 200 million barrels oil equivalent. Pandion energy holds a 20 percent interest in the license.

VP Exploration and Appraisal of Pandion Energy, Bente Flakstad Vold comments:

“In addition to expanding our exploration portfolio we have secured strategically important acreage surrounding the discoveries Pandion has taken part in during the past year, further strengthening our position in areas where we see additional upside potential.”

In March, Pandion Energy announced the results from exploration drilling in PL 820 S. Wells 25/8-19 S and 25/8-19 A proved hydrocarbons at five different intervals with the Iving discovery in the Skagerrak Formation being the most prominent with recoverable resources estimated to between 12 and 71 million barrels of oil equivalent. The operator, MOL Norge AS (40 percent), is together with partners Lundin Energy Norway AS (40 percent), Pandion Energy (10 percent before acquisition) and Wintershall DEA (10 percent before sale) planning an appraisal campaign in 2021. The license is located in blocks 25/7 & 8, north-northwest of the Balder and Ringhorne fields.

PL 617 contains the Eidsvoll prospect and is located in block 2/9, east-northeast of the Valhall & Hod fields where Pandion Energy holds a 10 percent interest. The operator, MOL Norge AS (40 percent), is together with partners OMV (Norge) AS (30 percent) and Wintershall DEA (30 percent before sale) planning to drill the Eidsvoll exploration well in 2021.

The transaction is subject to customary conditions for completion, including approval by the Norwegian Ministry of Petroleum and Energy.

Effective date for the transaction is 1 January 2021.

The wildcat well 6507/5-10 S is located about 23 kilometers north of the Heidrun field in the Haltenbank area, in the central part of the Norwegian Sea.

Preliminary estimates place the size of the discovery between 12 and 32 million standard cubic meters (Sm³) of recoverable oil equivalent, or about 75 to 200 million barrels oil equivalent.

The well encountered a total oil column of 270 metre in the Åre Formation and Grey Beds. Sandstone layers of 90 meters were encountered within the oil column with generally very good reservoir properties.

Pandion Energy, together with operator ConocoPhillips Scandinavia AS, will assess the results of the discovery together with other nearby prospects to determine the future appraisal and potential development solutions.

VP of Exploration and Appraisal at Pandion Energy, Bente Flakstad Vold, comments:

“We are proud to take part in the largest discovery in Norway this year. This illustrates the value creation potential in the team’s ability to make quick decisions based on a multidisciplinary work methodology. In light of the knowledge gathered from the discovery well, we see an exciting resource upside in both the discovery itself and other parts of the license. We now look forward to continuing our good cooperation with ConocoPhillips and contribute to realizing the full value potential in PL 891.”

Pandion Energy acquired its 20 per cent interest in the production license in July 2019 from operator ConocoPhillips, which holds the remaining 80 per cent.

CEO of Pandion Energy, Jan Christian Ellefsen, adds:

“The Slagugle discovery is a prime example of our exploration strategy targeting opportunities close to existing infrastructure with focus on prospects with material upsides. This is truly a great Christmas present and demonstrates the significant remaining resource potential on the NCS.”

The Slagugle well is the third discovery that Pandion Energy announces in 2020. In March, the company made an oil and gas discovery near the Balder field, in production license 820 S. The licensees are currently planning an appraisal campaign of this Iving discovery in 2021. In November, a minor gas discovery was announced in production license 263 D/E in the Norwegian Sea.

For further information see press release from the Norwegian Petroleum Directorate: Oil discovery north of the Heidrun field in the Norwegian Sea – 6507/5-10 S

• Pandion Energy submits Plan for development and operation of Hod
• Pandion Energy approves the Hod development project

The Duva oil and gas field is located in the northern North Sea and was discovered in the autumn of 2016. The Plan for Development and Operation (PDO) was approved in June 2019 with first production expected in late 2020 / early 2021.

Pandion Energy has with this completed the sale of it’s 20% non-operated interests in the Duva oil and gas field and associated licenses.

Related post: 07. November 2019 – Pandion Energy divests its 20 percent share in the Duva field.

Pandion Energy AS and Solveig Gas Norway AS have completed their previously announced transaction, whereby Pandion Energy has sold 10% non-operated interests in PL 636, comprising the Duva oil and gas field, and PL 636B.

The Duva oil and gas field is located in the northern North Sea and was discovered in the autumn of 2016. The Plan for Development and Operation (PDO) was approved in June 2019 with first production expected in late 2020 / early 2021.

Pandion Energy has also sold 10% non-operated interests in the same licenses to PGNiG Upstream Norway AS. This transaction is expected to be completed early 2020.

Related post: 07. November 2019 – Pandion Energy divests its 20 percent share in the Duva field.

The Plan for Development and Operation of Valhall Flank West was submitted in December 2017. First steel was cut at Kvaerner’s yard in Verdal in April 2018. Just over one year later, both the jacket and the topsides were installed on the field with no additional carry-over work.

Valhall Flank West is a well head platform, that will normally be unmanned, tied back to the Valhall field centre for processing and export. The installation receives power from shore via the Valhall field centre, in line with the partnership’s strategy of minimising the environmental footprint.

Since FID, several additional wells have been sanctioned bringing the recoverable reserves from 60 to close to 80 million barrels of oil equivalent, with further drilling targets being evaluated.

Recoverable reserves for Valhall Flank West were estimated to be around 60 million barrels of oil equivalent based on the drilling of six production wells. Since then, several additional wells have been sanctioned bringing the recoverable reserves close to 80 million barrels of oil equivalent, with further drilling targets being evaluated.

The partnership has invested NOK 5.5 billion in Valhall Flank West development project, which has an estimated break-even price of USD 28.5 per barrel. Around 1,500 people have been involved in the project.

Jan Christian Ellefsen, CEO of Pandion Energy commented:

“This is truly a day to remember. Valhall Flank West is the first development project we have participated in as a partner on Valhall & Hod. We are very impressed with the execution of the project  and the way the involved parties have worked as one team, delivering one of the safest projects on the NCS, on schedule and within budget.”

For more information see press release by Aker BP.