Norwegian Energy Company (Noreco) announced an FID on two infill wells, the first of which is expected to be drilled by Shelf Drilling's Winner jackup in early spring 2023. The two wells will be drilled at the Tor reservoir in the Halfdan North East area, located in the central part of the Danish North Sea. Both wells are expected to increase gas production from the Halfdan field, with plateau production expected during autumn 2023. The first well is expected to have an initial production rate of 3 million BOED net to Noreco, where approximately 75% is gas. The expected gain from the infill wells is approximately 2.9 million BOE net to Noreco, of which approximately 50% is gas. The total cost of the drilling campaign to Noreco is $39 million, implying a total unit development cost of approximately $13/BOE. Based on expected reserves and forward curves of Brent and TTF from November 2022, the forecast IRR is above 200% with a payback period of around six months, making the infill wells highly attractive from an economic and strategic perspective. “I am delighted to announce this significant milestone for the Danish Underground Consortium (DUC), where we have not had drilling activity since 2019. It has never been a better time to invest in further drilling and field development activities to ensure that the recovery from the DUC fields is maximized. Several highly economic opportunities are currently being matured and this is the first of many investment decisions to be made, in line with Noreco's objective to maximize gas output in the short, medium and long term,“ said Marianne Eide, Noreco COO.
