Norway's Aker BP finds additional oil at North Sea Yggdrasil project

Norway's No. 2 oil producer Aker BP on Aug. 21 raised its estimate of oil volumes discovered at a newly drilled well to be tied back to the Yggdrasil hub, due on stream in 2027.

The company had earlier put its volume estimate for the Omega Alfa multilateral exploration well at 20 million-40 million barrels of oil equivalent, but has now raised this to 96 million-134 million boe, advancing its goal of increasing total volumes at the hub to 1 billion boe; the current reserve estimate is 700 million boe.

Yggdrasil encompasses a cluster of discoveries made variously by Aker BP and state-controlled Equinor, and combined into one development. Crude from the project will be fed into the Grane blend, loaded on Norway's coast, with gas going to the Karsto processing plant.

Grane is a relatively heavy crude with a current API gravity of 27.1 and medium sulfur content. It is already sourced from multiple fields including Aker BP's Edvard Grieg and Ivar Aasen. Aker BP has said it does not expect a major change in Grane crude quality as a result of the Yggdrasil influx.

Heavier, more sour North Sea crudes have been attracting strong market interest in recent years due in part to the outlawing of Russia's Urals.

Grane was last assessed by Platts -- part of S&P Global Energy -- at a $1.35/b premium to Dated Brent on Aug. 20.

Aker BP recently raised its cost estimate for Yggdrasil by $1 billion to $12.1 billion, citing currency changes and increased industry costs.

"Omega Alfa is among the largest commercial discoveries in Norway in a decade. We look forward to unlocking even more of the potential in this prolific area," Aker BP CEO Karl Johnny Hersvik said in a statement. Yggdrasil "is progressing according to plan, with first oil expected in 2027," the statement added.

The ownership of the various Yggdrasil licenses is fragmented, with Aker BP, Equinor and Poland's Orlen as the main shareholders.

Engineering company Aker holds the largest stake in publicly listed Aker BP, at 21.16%, followed by BP on 15.87%.