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Half Mag / Half Zine

Norway’s Equinor (EQNR.OL) has begun pumping oil from the second phase of its giant Johan Sverdrup development, it said on Thursday, boosting output from Europe’s biggest producing field by at least 185,000 barrels per day.

The startup comes just days after European Union sanctions on Russian seaborne crude took effect.

“At plateau, the (full) Johan Sverdrup field will produce 720,000 barrels of oil daily, aiming to rise to 755,000 barrels per day,” Equinor said in a statement.

“Johan Sverdrup alone can thus meet 6-7% of the daily oil demand in Europe,” it added.

Until now, the Sverdrup field has produced around 535,000 barrels of oil per day, according to Equinor.

It did not indicate when production could hit 755,000 barrels, and a company spokesperson was not immediately available to comment.

European demand for the medium-heavy Sverdrup crude, similar to Russian Urals, has increased following Moscow’s February invasion of Ukraine as many European buyers voluntarily ditched Russian barrels.

A succesful increase in production from Sverdrup is good news for European refiners, with the International Energy Agency (IEA) last month noting that it was the “most suitable” replacement for Urals.

The full-field development of Johan Sverdrup has a break-even price of less than $15 per barrel, Equinor said, far below the current benchmark price of $82.6 per barrel for North Sea crude, although Sverdrup sells at a slight discount.

Norway’s majority state-owned Equinor, which operates the field, has a 42.6% stake in Sverdrup, while partner Aker BP (AKRBP.OL) has 31.6%, Norway’s Petoro 17.4% and TotalEnergies (TTEF.PA) 8.4%.