Norway's Sverdrup Phase 2 oil output restart delayed after power failure

Production at Norway's flagship Johan Sverdrup oil project remained at a reduced rate of 535,000 b/d on Jan. 16 as an equipment fault hampered recovery from a power failure at recently commissioned Phase 2 facilities, a spokesperson for state-controlled Equinor said.

Following the Jan. 11 power failure the core Phase 1 facilities quickly restarted and "produce a stable 535,000 b/d," the spokesperson told S&P Global Commodity Insights.

Power supply was then restored on Jan. 13 at the Phase 2 facilities, which were first put into operation in mid-December. However, the restart of production at the Phase 2 process platform is "delayed due to an equipment fault that occurred when starting after a couple of days from a cold platform," the spokesperson said. "Repair work has started."

The Phase 2 facilities are expected to raise overall Sverdrup crude capacity to a plateau of 720,000 b/d, with possible increases above that level. Prices for the medium sour grade have been supported of late by sanctions against Russia and curbs on buying Russia's Urals.

Sverdrup crude was assessed at a $1.5/b discount to North Sea benchmark Dated Brent on Jan. 13, unchanged on the day, by Platts, which is part of S&P Global Commodity Insights.

Equinor on Jan. 14 revised its loading schedule for January for Sverdrup, pushing some cargoes into February.

The Sverdrup project, which first came on stream in 2019, relies on renewable power from the mainland, sent offshore through a 200 km subsea cable, part of Norway's efforts to lower emissions. It has also served as a catalyst for bringing low-carbon power supply to other nearby facilities.