Insufficient financial robustness: OKEA halts Vette discovery

Insufficient financial robustness: OKEA halts Vette discovery

OSLO, NORWAY: OKEA, as operator of the Vette licence (40% Working Interest (WI)), has decided to propose to the licence partners not to develop the Vette discovery further, due to the project’s insufficient financial robustness, a bourse filing said.

OKEA took over operatorship of the licence earlier this year and has been maturing the discovery towards a DG2 decision.

OKEA has also worked to improve the economics of the Grevling/Storskrymten discoveries along with the license partners over the last few years. Although significant reductions in break-even cost have been achieved, it is deemed insufficient to warrant a stand-alone field development.

As OKEA was targeting a joint serial development of the Vette discovery together with the Grevling/Storskrymten discoveries, the decision to halt further development of Vette also implies that OKEA is likely to halt further development of Grevling/Storskrymten.

“With the start-up of the Yme field in the second half of 2021 and energy prices at multi-year highs, OKEA has a strong cash balance which we aim to deploy where we can add the greatest value. We see several attractive opportunities on the NCS with significant upside potential. Therefore, we believe there are other investments that will provide greater near-term value creation for OKEA and better returns to our shareholders,” says OKEA CEO Svein J. Liknes.

Partners in the Vette licence (PL972), ONE-Dyas Norge AS and M Vest Energy AS, each hold 30% WI.

OKEA is the operator of the Grevling discovery (PL038 D) with 35% WI. The other partners are Chrysaor Norge AS (35% WI) and Petoro AS (30% WI). OKEA is also operator of the Storskrymten discovery (PL974) (60% WI) with licence partner Chrysaor Norge AS (40% WI).

OKEA will present a company strategy update to the market along with its third quarter 2021 results on 28 October.

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