A review of 66 projects on the Norwegian Continental Shelf (NCS) in 2007-18 reveals that most have kept their cost within the estimates given in their plan for development and operation (PDO).
A review of 66 projects on the Norwegian Continental Shelf (NCS) in 2007-18 reveals that most have kept their cost within the estimates given in their plan for development and operation (PDO).
The report on project execution on the NCS by the Norwegian Petroleum Directorate showed improved execution of development projects.
‘The big picture shows that the projects have progressed positively in terms of both cost control and planned execution,’ said Niels Erik Hald, assistant director development and operations at the NPD. ‘This emphasises the importance of the companies pursuing detailed early-phase work in projects.’
The report compares costs, start-up time and reserve developments with the estimates made in the PDO. Just over 80 per cent of projects have ended up with their costs within or below the uncertainty range (plus/minus 20%) in the estimates.
Ninety per cent of subsea projects have been completed in accordance with or below the PDO forecast. Platform developments have been more challenging, and a number of these have experienced cost overruns. The review nevertheless shows that over 70 per cent of them end up in line with their estimated cost.
Market developments since the oil price slump have also contributed to a positive trend because the availability of resources and capacity at suppliers was better than in earlier years.
On average, completed projects have taken about 3.5 months longer than planned.
