Arctic oil seen decades away by Swedish Lundin

February 24, 2014

Lundin Petroleum AB (LUPE), the Swedish explorer focused on Norway, said there won’t be any oil production in the ice-filled waters of the Arctic for at least 15 years because of technical and logistical challenges, Bloomberg reported on February 24. 

“I don’t think we’ll see any oil production in the Arctic any time soon -- probably not this decade and not the next,” Chairman Ian Lundin said in a Feb. 20 interview in Stockholm. “The commercial challenges are too big.”

“It may take a while to develop the right technology,” Lundin’s chairman said. “Investments are very, very high so it still has to be commercially justified.”

An exception is the southern part of Norway’s Barents Sea, he said. While inside the Arctic circle, it benefits from a less-harsh climate and shallower and ice-free waters, and may hold 8 billion barrels of oil equivalent in undiscovered resources, more than 40 percent of the country’s total.

“In the Barents Sea we’ll probably see production much sooner because there’s no technological gap,” he said. “It’s now just a matter of having the reserve base that you’re required to have to justify the investment.”

Copyright: Bloomberg, 2014