Norwegian oil and gas company Statoil ASA (STO) resumed production at its Troll C platform in the North Sea, which was shut down last week. Production was suspended on account of corrosion discovered by inspectors in some tanks of a gas treatment system.
The company did not specify the duration of the repair work but the problem was temporarily solved through a method. It involved re-injection of untreated gas into the reservoir, which helped to resume work. It is expected that around 70% of the platform’s capacity could be achieved through this process.
Production capacity of Troll C is around 120,000 barrels of oil per day and 371 million cubic feet of gas per day. It is one of the three production platforms in the Troll field.
Apart from Statoil, there are a number of companies, which hold a stake in the Troll field including Petoro AS, Total SA (TOT), ConocoPhillips (COP) and Royal Dutch Shell plc (RDS.A).
We appreciate Statoil’s endeavor to improve recovery of resources in mature fields. The company has operations in all major hydrocarbon-producing regions of the world, with an emphasis on the Norwegian Continental Shelf (NCS). We believe that Statoil is well positioned to sustain its steady production growth for the next few years on the back of its large resource base at NCS.
However, Statoil’s performance will likely be affected by the volatile macro environment, fluctuating oil and natural gas prices and geo-political disturbances.
Statoil holds a Zacks #3 Rank, which is equivalent to a Hold rating for a period of one to three months. Longer term, we maintain our Neutral recommendation on the stock.
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