OSLO (Reuters) - Norway's Equinor (OL:EQNR) said on Monday its Johan Sverdrup oilfield is ramping up output at a faster pace and will produce more barrels per day than initially expected.
Western Europe's biggest producing oilfield is now expected to hit a daily output rate of 470,000 barrels in early May, above the 440,000 bpd peak that had initially been pencilled in for mid-year, it said.
The news comes as the price of North Sea crude has dropped to its lowest in 18 years amid a glut of output and falling global demand.
But the cost of operating the field amounts to less than $2 per barrel, making it resilient to weak prices, Equinor said.
"With low operating costs Johan Sverdrup provides revenue and cashflow to the companies and Norwegian society at large in a period affected by the coronavirus and a major drop in the oil price," Equinor executive Arne Sigve Nylund said in a statement.
The field, which holds an estimated 2.7 billion barrels of oil equivalents, began production last October, two months ahead of schedule.
It now produces more than 430,000 bpd from nine wells and a 10th well will soon be completed, the operator said.
"Field production has been very good and stable from day one, and the wells have produced even better than expected," said Rune Nedregaard, vice president for Johan Sverdrup operations.
A second phase of the Sverdrup field development is still scheduled to come on stream in late 2022 with output of 220,000 bpd.
Equinor holds a 42.6% stake in the field, while Sweden's Lundin Petroleum (ST:LUPE) has 20%, state oil firm Petoro has 17.4%, Norway's Aker BP (OL:AKERBP) 11.6% and French Total (PA:TOTF) 8.4%.
In a separate statement, Lundin Petroleum (ST:LUPE) said it would raise its own 2020 output guidance as a result of the higher Sverdrup production.