Costs rise for Norway’s oil and gas projects as COVID-19 hits

Major development of Norway’s offshore oil and gas projects have been obstructed, with rising costs and delayed startups as the COVID-19 pandemic makes its way into the region, the government and oil company Equinor said on Wednesday.

Costs of projects soared by 13.2 billion Norwegian Crowns ($1.4 billion) after lockdowns stalled construction sites at several fields, with the country’s oil output expected to slip to 2.15 million barrels per day (bpd) on 2021. This will be slightly less than last year’s forecasted 2.24 million bpd.

Meanwhile, gas production is expected to be 117 billion cubic meters, less than 121 billion cubic meters forecast a year ago.

Equinor’s Martin Linge oil and gas field is also expected to cost 60.8 billion Crowns compared to an estimated 56.1 billion Crowns last year.

Cost overruns also hit Equinor’s Njord Future, Repsol’s Yme as well as other developments.