Petrochemicals group Ineos is to establish an oil and gas field in Denmark after the nation’s very first approval of such a job in years.
The UK group’s statement on Friday comes as Europe’s energy crisis triggers a look for options to Russian gas. It likewise indicates a shift in policy for Denmark, which had actually been moving far from nonrenewable fuel sources.
Ineos will establish the Solsort West field in the North Sea with its partners Danoil and Nordsøfonden, with very first production of oil and gas anticipated in the 4th quarter of 2023. Gas production from the field will cover 10 percent of Danish intake, Ineos stated.
In authorizing the advancement today, the Danish Energy Agency stated the Solsort field was anticipated to represent 12 percent of Danish oil production in 2024 and 5 percent of gas production.
Mads Weng Gade, head of Ineos Energy DK, stated the task was “the first Danish oil and gas development in many years”, which it “will be a valuable contribution to Danish and European energy independency and self-sufficiency in a difficult period for Europe”.
But Tom Marzec-Manser, head of gas analytics at consultancy ICIS, questioned whether the task would have a product effect on Europe’s supply.
“Denmark consumes around 2bn cubic metres of gas annually. Based on what Ineos have said, this suggests Solsort production will be no more than 1.0 million cubic metres per day,” he stated.
“Before the war Russia was sending 165mn cubic metres a day via Nord Stream 1, and European demand in the winter can be over 2bn cubic metres per day at the top end,” he stated.
He included that Ineos’s advancement was “not going to alter Europe’s gas supply and demand balance in any structural sense”.
Denmark began drawing out oil and after that gas in the North Sea in 1972, with tax income a foundation in structure and preserving the nation’s well-being state, however output has actually decreased for several years. Production peaked in 2004 for oil and 2005 for gas, according to the Danish Energy Agency.
The nation’s most significant gasfield, Tyra, has actually been under redevelopment given that late 2019, with production not anticipated to resume up until 2023. The nation ended up being a net oil importer in 2018.
Denmark has actually turned into one of the worldwide leaders in environment diplomacy. At the COP26 environment top in 2015, the nation, together with Costa Rica, formed an international group to end oil and gas production. It likewise chose in 2020 to end all brand-new oil and gas expedition in the North Sea.