Equinor and Ithaca Energy Greenlight Rosebank Development
Posted 27/09/2023 13:20
Norwegian energy company Equinor and UK-based Ithaca Energy have jointly announced their final investment decision to advance Phase 1 of the Rosebank development project on the UK Continental Shelf. The companies will invest $3.8 billion in this offshore project, situated approximately 130 kilometers northwest of Shetland in water depths of around 1,100 meters. The total estimated recoverable resources at Rosebank amount to roughly 300 million barrels of oil, with Phase 1 targeting 245 million barrels of oil. Equinor holds an 80% ownership stake in the development, while Ithaca owns the remaining 20%.
The Rosebank field will utilize subsea wells connected to a redeployed Floating Production Storage and Offloading (FPSO) vessel, with first oil production anticipated between 2026 and 2027. Shuttle tankers will transport the oil to refineries, while gas will be exported through the West of Shetland Pipeline system to mainland Scotland. Equinor highlighted that the Rosebank field is expected to produce over 21 million standard cubic feet of natural gas daily, equivalent to the daily energy consumption of Aberdeen City.
The Rosebank project aligns with the North Sea Transition Deal (NSTD), an agreement between the UK government and the offshore industry, emphasizing the necessity of reducing emissions while meeting the remaining demand for oil and gas. The FPSO has been designed to accommodate electrification and Equinor is collaborating with stakeholders to establish a regional power-from-shore solution to minimize carbon emissions from production.
According to an independent socioeconomic report by Wood Mackenzie and Voar Energy, Rosebank is projected to generate $9.84 billion (GBP 8.1 billion) in total direct investment during its operational life. The project is expected to create approximately 1,600 jobs during the construction phase and sustain about 450 UK-based jobs throughout its operational life. Several companies have already secured contracts related to the project, including TechnipFMC, Odfjell Drilling, and Altera.
On September 27, the North Sea Transition Authority granted development and production consent for Rosebank. This consent enables Equinor and Ithaca Energy to proceed with the project, and it aligns with the UK government's efforts to maintain a domestic oil and gas industry while transitioning to cleaner energy sources.
Chancellor of the Exchequer Jeremy Hunt emphasized the importance of utilizing domestic oil and gas resources to enhance energy security and boost the economy. He stated that Rosebank's development will bring billions of pounds into the UK economy and secure the country's future energy supply.