Oil search “too expensive” in Denmark

A new North Sea strategy is expected to be completed sometime by May 2015

Sit back and hope for the best (photo: istock)
April 25th, 2014 5:14 pm| by admin
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The Danish state’s oil and gas company, Nordsøfonden, has announced that the search for oil in the Danish areas of the North Sea are too expensive, Berlingske newspaper reports.

During a meeting yesterday at which the energy authorities, Energistyrelsen, opened up the seventh bidding round for offshore drilling permits in the North Sea, Peter Helmer Steen, the head of Nordsøfonden, voiced his discontent.

“The costs associated with drilling and building new platforms in Denmark are far too steep,” Steen said according to Berlingske.

“They need to go down if we want more resources extracted. We can see that some of our drilling costs are twice as high in Denmark as they are in other countries.”

READ MORE: Future gas will come from abroad

High standards
The high costs in Denmark could stem from the technical areas – such as the number of days it takes to drill – and expenses associated with supply ships, but part of the cost comes from the necessary requirements now needed to operate rig equipment.

The steep costs have weakened competition in Denmark, and stringent regulation is an area that the authorities will look into when they develop a new strategy for oil excavation in the North Sea.

That strategy is expected to be completed sometime by May 2015.

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