Var Energi and Kistos Energy Norway have made the final investment decision (FID) for the Balder Phase V project in the Balder area of Norway.

The project is expected to unlock 33 million barrels of oil equivalent (boe) of gross proved plus probable reserves, with a capital expenditure of $690m (Nkr7.56bn) and an estimated breakeven price of around $30 per barrel.

The Balder Phase V project will see the drilling of up to six infill wells, utilising all remaining template well slots in the existing subsea facilities at Balder and linked back to the Jotun floating production storage and offloading (FPSO) unit for processing.

The drilling of multilateral wells will expand reservoir area, boost recoverable reserves, improve recovery factor and cut down the number of wells needed.

Drilling operations are scheduled to commence in H1 2025 and conclude in 2026. The first well is expected to come online by the end of 2025.

Var Energi has a 90% stake in the field and is the operator. Kistos Energy Norway holds the remaining 10% interest.

As Var Energi progresses with its development projects, the company is on track to achieve daily production rates of approximately 400,000boe by the end of next year.

Var Energi is committed to maintaining long-term production levels by advancing more than 20 early-phase projects.

Balder Phase V represents the first of these projects to be approved, with the company anticipating several additional project sanctions throughout next year.

Var Energi COO Torger Rod said: “The Balder area in the North Sea is one of Var Energi’s core hubs and constitutes significant future resource potential. With the refurbished Jotun FPSO on track to commence production from the field within Q2 2025, we have the tool to unlock additional production,

“The sanctioning of Balder Phase V aligns with our strategy of maximising value in our core hub areas by utilising existing capacity and infrastructure. I am very pleased to see how the upgraded FPSO will contribute to amplifying value creation from the area with such immediate effect. Beyond Balder Phase V, we are also maturing a Balder Phase VI project ensuring further long-term value creation in the area.”

In August, Var Energi announced a revised schedule to begin the Balder X project in the North Sea.  

The company stated that the delay to the start of production was because work on the Jotun FPSO was yet to be completed.