The development of the Martin Linge oil and gas area will not begin until 2020 due to increasing costs. Norwegian state-owned Equinor made the purchase from Total S.A., a French oil firm, last year.
Martin Linge, which is located in the North Sea, is estimated to come with a $5.7 billion development price tag. This is a 59% increase from the original estimate tabled in 2012.
Originally scheduled to start up in the first part of 2019, the field’s development is being postponed to the first quarter in 2020.
The field’s controlling stake owner, Equinor has confirmed the delay, stating that the rising expenses were being factored in based on remaining work. Equinor took over Total’s 51% for $1.45 million.
Despite cost increases at Martin Linge, Equinor announced a reduction in their overall developments budget by 30 billion NOK for operations in the continental shelf of Norway. At the Johan Sverdup Phase 1 site alone, Equinor was able to shrink the budget down by 30 percent.
According to Equinor executives, the reductions were possible thanks to simplifying project management and providing better options for efficient drilling. The company has 18 projects in the region, as well as three projects that are pending approval.