Orrön Energy AB (publ) Profile
Orrön Energy AB (publ) operates as a renewable energy company. The company operates wind and hydro assets in the Nordics.
The company’s growth strategy continues to deliver results with total resource additions in 2021 of 200 percent of produced volumes, supported by further reserves growth in the Greater Edvard Grieg Area and the above-mentioned additional interest in Wisting. The company delivered record results on all fronts in 2021, production hit 200 thousand barrels of oil equivalent per day (Mboepd) at times.
In October 2021, the company entered into a sales and purchase agreement for the acquisition of OMV Norge AS’s 25 percent working interest in the Wisting discovery. The transaction increased the company’s working interest to 35 percent.
The company has 639 million barrels of oil equivalent (MMboe) of proved plus probable net reserves (2P) and 799 MMboe of proved plus probable plus possible net reserves (3P) as of 31 December 2021, as certified by an independent third party. The company has an additional 380 MMboe net oil and gas resources, which classify as best estimate contingent resources (2C) as of December 31, 2021. The total resource base, made up of 2P reserves plus 2C contingent resources, is 1.0 billion (Bn) Barrels of oil equivalent (boe) as of December 31, 2021. Production was 190 thousand barrels of oil equivalent per day (Mboepd), at the top end of both the original guidance range of 170 to 190 Mboepd, and the updated guidance range of 180 to 195 Mboepd, released in June 2021
The Johan Sverdrup Phase 2 development project involves a second processing platform bridge linked to the Phase 1 field centre, subsea facilities to access the Avaldsnes, Kvitsøy and Geitungen satellite areas of the field, implementation of full field water alternating gas injection (WAG) for enhanced recovery and the drilling of 28 additional wells. The Johan Sverdrup gross field reserves are in the range of 2.2 to 3.2 billion boe and the ambition of the partners in the field, is to achieve a recovery factor of more than 70 percent. In June 2021, the company announced that the full field gross processing capacity will be increased to 755 tThousand barrels of oil per day (Mbopd) once Phase 2 comes on stream.
The Wisting project is scheduled to be one of the next Barents Sea production hubs and will be a significant contributor to sustaining the company’s long term production profile. With the acquisition of a further 25 percent working interest announced on 28 October 2021, the company’s working interest in the project has increased to 35 percent and will add material pre-development resources in a strategic core area for the company, with significant surrounding prospectivity.
In November 2021, the project development concept was approved by the licence partners, with the project on track for PDO submission by end 2022, allowing the project to benefit from the temporary tax incentives established by the Norwegian Government in June 2020.
In June 2021, the PDO for the joint development of the two discoveries Kobra East and Gekko was submitted to the Norwegian Ministry of Petroleum and Energy and was approved in January 2022. The development will be a subsea tie-back to the Alvheim FPSO and phase one of the development will include four tri-lateral production wells targeting the oil zones of the two discoveries. Phase two of the development consists of a gas production well targeting the gas cap at Gekko, which will be drilled at a later stage once gas processing capacity is available on the Alvheim FPSO. Drilling operations are expected to commence in early 2023, with first oil planned in the first quarter of 2024. Total gross 2P reserves for the project amount to 39 MMboe and the development will provide gross peak production of approximately 28 Mboepd.
In September 2021, the PDO for the development of the Frosk discovery was submitted to the Norwegian Ministry of Petroleum and Energy. The development will be a subsea tieback to the Alvheim FPSO through the existing Bøyla Manifold. The development includes the drilling of two new wells. Drilling operations are expected to commence in 2022, with first oil planned in the first half of 2023. Total gross reserves for the project amount to approximately 9 MMboe and the development will provide gross peak production of approximately 13 Mboepd, with a breakeven oil price of less than USD 25 per boe.
The 2021 exploration and appraisal programme consisted of eight wells. In July 2021, a two-well appraisal drilling campaign was completed on the Iving discovery located in the Central North Sea close to the Balder and Ringhorne fields.
In January 2021, the company was awarded 19 licences in the 2020 APA licencing round, of which seven are as operator.
In February 2021, the company entered into a sales and purchase agreement with Aker BP involving the acquisition of a six percent working interest in licences PL036E, PL036F, PL102H, PL102F, PL102D and PL102G which includes the Trell and Trine Unit. The transaction included the sale of a five percent working interest in PL869 and a 15 percent working interest in PL1041. In January 2022 Lundin Energy entered into a sales and purchase agreement with MOL involving the acquisition of a ten percent working interest in licences PL102F and PL102G, which includes the Trell discovery and Trell Nord prospect, equivalent to 6.84 percent in the Trell and Trine Unit, bringing Lundin Energy’s total working interest to 12.84 percent in the Unit.
In June 2021, Lundin Energy was awarded two licences in the 25th licencing round.
In January 2022, the company was awarded 10 licences in the 2021 APA round, of which five are as operator.
The company holds 97 licences in Norway.
In April 2021, the company completed a transaction with OX2 AB (OX2) to acquire a 100 percent interest in the Karskruv onshore wind farm project in southern Sweden. The construction works on the wind farm have already commenced and are progressing on schedule with the facility planned to be operational in late 2023 with production of an estimated 290 GWh per annum, from 20 onshore wind turbines.
The company has committed to three renewable projects, with a combined net power generation capacity of around 600 GWh per annum from late 2023 and these investments will remain in the company after the combination with Aker BP with an aim to become a platform for growth.
Research and Development
The company invested MUSD 18.8 in research and development (R&D) in 2021.
History
The company was founded in 2001. The company was incorporated in 2001. It was formerly known as Lundin Energy AB (publ) and changed its name to Orrön Energy AB (publ) in July 2022.
