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Full speed for Maersk with largest ever Danish North Sea investment

02nd December 2017

Maersk Oil has announced that the Danish Underground Consortium (DUC) has approved an investment of approximately USD3.35bn in the full redevelopment of the Tyra gas field. The announcement follows the Danish Parliament’s approval to implement legislation to secure the investment.

Tyra East platform
Tyra East platform

Tyra East platf

The redevelopment of Tyra ensures continued production from Denmark’s largest gas field, and will protect and rejuvenate important Danish North Sea infrastructure.

The announcement represents the largest oil and gas project investment ever made in the Danish North Sea, enabling Tyra to continue operations for at least 25 years. At peak production, the redeveloped Tyra gas field will provide enough gas to supply 1.5 million Danish homes, supporting energy security, future tax revenues and employment for Denmark.

The investment cost for the modification to existing facilities and construction of new facilities (CAPEX) is estimated at USD2.7bn and the cost in relation to removal and decommissioning of current facilities (ABEX) is estimated at approx. USD0.64bn.

Tyra is the centre of Denmark’s national energy infrastructure, processing 90 per cent of the nation’s gas production. Through new development projects and third-party tie-ins, the redevelopment of Tyra can be a catalyst for extending the life of the Danish North Sea – not just for Maersk Oil and the DUC, but also for Denmark.

The new infrastructure can enable operators to pursue new gas projects in the northern part of the North Sea, where the most recent development, Tyra Southeast, delivered first gas in 2015 and is producing above expectations.

The redeveloped Tyra is expected to deliver approximately 60.000 barrels of oil equivalent per day at peak, and it is estimated that the redevelopment can enable the production of more than 200 million barrels of oil equivalent. Approximately 2/3 of the production is expected to be gas and 1/3 to be oil.

Alongside the Maersk Oil-operated Culzean development in the UK North Sea, the Tyra gas field redevelopment increases Maersk Oil’s exposure to natural gas production; an important bridging fuel for the energy transition.

“Tyra has been a key asset in the history of Maersk Oil, and an important source of energy security for Denmark,” Maersk Oil chief executive officer, Gretchen Watkins, said. “The redevelopment of Tyra is the largest investment carried out in the Danish North Sea, and when completed in 2022, production from the Tyra field itself has the potential to cover Danish gas consumption for a decade.

“The redevelopment of Tyra is evidence of a shared interest in prolonging the life of the Danish North Sea. The investment in this globally significant oil and gas project will support several thousand Danish jobs, and it can enable future significant industry investments in new development projects made possible by the redeveloped Tyra gas infrastructure.”

The Tyra field will be shut-in for the redevelopment in November 2019, and production is expected to recommence in July 2022.

 

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