Norway's Var Energi pulls trigger on trio of hydrocarbon discoveries

Var Energi, backed by Italy's Eni, has taken a Final Investment Decision on a trio of oil and gas discoveries in the Norwegian North Sea, it said in a statement June 25, extending the lifespan of an area that supplies gas to the UK and feeds Troll crude flows.

The FID covers the Gjoa Subsea Projects, specifically the development of the Ofelia, Gjoa Nord and Cerisa hydrocarbon discoveries, which will be tied back to existing infrastructure on the Gjoa and Duva fields, which it acquired in 2024.

The project aims to extend the lifespan of the Gjoa area – from the early 2030s to around 2040 – and support Var's long term production goals, said the company, which has set a long-term target of pumping 400,000 barrels of oil equivalent/day of oil and gas. The company's 2026 guidance is set at 390,000-400,000 boe/d.

In a statement to Platts, part of S&P Global Energy, a Var spokesperson said the company pumped 17,000 boe/d from the Gjoa area in Q1. They added that the new projects "they will add to the production profile going forward, ensuring we maintain production from the area in years to come".

Cerisa is expected to come online first, in the third quarter of 2027, followed by the startup of Ofelia and Gjoa Nord in the second half of 2028, it said.

The project targets some 76 million barrels of oil equivalent of proven and probable reserves on a gross basis, with a breakeven below $35/boe, Var said. It could also present opportunities for further tieback developments and near-field exploration.

The Gjoa hub is a core asset for Var, which recently acquired projects from Pandion and signed a swap deal with DNO on the Norwegian Continental Shelf, increasing its ownership in, among others, the Gjoa Subsea Projects.

Var is the project's operator, with a 40% interest in Ofelia and 30% in both Gjoa Nord and Cerisa. Partners include Aker BP, Harbour, Pandion, DNO and Petoro.

"The Gjoa Subsea Projects demonstrate how we continue to develop our core hubs through efficient tie-back developments, leveraging existing infrastructure and exploration success to create long term value," said Var's COO Torger Rod.

"The project strengthens Gjoa as a long-term production hub and supports our target to produce more than 400,000 b/d barrels of oil equivalent per day long-term," he added.

Export routes

A mature field, Gjoa was discovered in 1989 and started producing in 2010. Its liquids are shipped through a pipeline connected to the Troll Oil Pipeline II, and on to the Mongstad export terminal, according to government-run Norwegian Petroleum.

Troll the heaviest grade used to underpin Dated Brent, the backbone of the global physical crude trade.

Meanwhile, its gas is exported via the Far North Liquids and Associated Gas System on the UK continental shelf, where it is processed at the huge St Fergus terminal, the agency said.

The FID comes as Norwegian operators are taking steps to counter natural declines across the NCS by extending lifespans, reviving shuttered fields and stepping up exploration.

The country is a pivotal gas supplier for Europe and has seen demand for its crude rise following the wars in Ukraine and Iran.

Its flagship Johan Sverdrup export grade was assessed at a $2.99/b premium to Dated Brent on June 24 by Platts, part of S&P Global Energy.