Svenska Petroleum Exploration

Exploring potential

With activities mainly in West Africa and Norway, Svenska Petroleum Exploration is a Swedish based oil and gas company specialising in offshore exploration and production.

Operating under the privately held holding company Petroswede owned by Sheikh Mohammed H. Al-Amoudi, Svenska’s highly skilled workforce is made up of a high percentage of geoscience professionals who use their knowledge and experience to facilitate the company’s three main activities of exploration, development and production. The organisation celebrated its 40th anniversary earlier this year and its current activities reach an average production around 10,000 barrels of oil per day, while the resource base is around 150 million barrels of oil equivalents. With offices in Stockholm, Oslo and London, Svenska’s vision is to build a leading oil and gas company focused on developing a balanced and lucrative portfolio for oil exploration, development and production. This growth strategy is based on a combination of acquisitions, expansion and active exploration in areas where Svenska has established relationships, as well as technical and commercial competence.

Bjorn Inge Tonnessen, executive vice president of the group and managing director in Oslo, outlines the company’s main strengths and assets in the industry: “Our biggest areas of operations at the moment are offshore West Africa and Norway. Our key strength lies in our excellent competence for sub surface issues, as well as our skills in identifying opportunities for new business. We look to establish firm partnerships in strategic areas, where we can have involvement as a partner in large exploration projects. Our major asset at the moment is a nearly 30 per cent interest in a field in the Ivory Coast, called Baobab. We also have discoveries in Norway and Nigeria that we expect will come into production in the coming years. Svenska will participate in quite a number of exploration wells within the next few years. However, we will also seek to add more production assets in order to bridge the gap between the current producing fields and the discoveries not yet in production.”

The business has plans to revitalise the Norwegian presence through exploration activities, while gaining licences and expanding in Western Africa where there are a lot of benefits for a medium sized company like Svenska. In the Gulf of Guinea the company has a 55 per cent equity interest in the Block 2 Sinapa discovery and the Blocks 4A and 5A Esperanca discoveries, while in Nigeria its assets reach a 30 per cent interest in OPL 244 and a 20 per cent interest in OPL 214 including the Uge and Orso discoveries. In this region partnerships are held with Exxon Mobil, Chevron, ConocoPhillips, NPDC, ENI and Sasol. Svenska has been active in Angola since 1986, with production having started in 1990 and the company has current interests in Block 8, Block 23, Block 3/85 including Cobo and Pambi, and Block 3/91 at Oombo.

The Ivory Coast fields are the company’s greatest focus with a large producing field and several discoveries occurring in the region, such as the Kossipo and Koto prospect. In 2008 Svenska participated in a large re-drilling campaign in the Baobab field that managed to nearly double the production from that field. Bjorn explains: “We have expanded our portfolio and exploration licence to cover areas from Guinea Bissau down to southern parts of Angola. Recently we decided to move away from the mature fields that are heading towards the end of their life, in order to focus on placing more investment in exploration, development and production in up and coming areas. In the future we will have production in Nigeria and Norway in addition to the Ivory Coast and Angola, while in the mean time we will try to acquire more production areas to bridge the gap between current and future production.”

Other regions of potential include Russia where Svenska held a test balloon, which proved to be very challenging and the Baltic Sea where drilling progress was halted due to complications with the Swedish government. The company has identified potential in this area and is hoping to participate in drilling at some stage. Such complications are an established part of working in the global oil and gas industry, Bjorn describes Svenska’s experience of the current market conditions: “For oil companies a main worry is always the oil price. At the moment oil is being held at a price of $70 per barrel, which is a lot more beneficial than what we were experiencing a few months ago. It may be too early to say, but I am a firm believer that the oil price will strengthen even further in the long term.”

One of the company’s greatest and most recent successes was in a significant discovery of a gas condensate field through the drilling of the Fulla well, which is based ten kilometres east of the Frigg Field in the North Sea. The well has shown that the discovery potentially holds within the range of 60 to 105 million barrels of recoverable oil equivalent. The exploration regime in Norway is highly competitive and Svenska made the discovery on the first try after changing strategy – a massive boost to the company as most companies hit oil one in five attempts. Bjorn comments: “It is very encouraging to have such a significant discovery in the first well drilled after refocusing our activities in Norway from tail-end production towards an exploration focused portfolio over the past few years. We did a lot of technical work even though we were a minority partner and we were proved to be right – we are very proud of this achievement.”

Looking to the future, Svenska hopes to demonstrate its expertise and exploration proficiency in a number of new regions based around its existing relationships and success in regions such as West Africa and Norway. In terms of production and reserves, Bjorn believes the company will have expanded significantly in the coming years, potentially through acquisition but also as a result of further discoveries and operations.

Svenska Petroleum Exploration

Services Oil and gas exploration