EIA: Norway’s Troll crude oil to be included in Brent price assessment
The method for assessing the Brent global benchmark crude oil price is scheduled to change in 2018. The Brent price benchmark reflects transactions involving physical cargoes of several specific grades of crude oil in the North Sea, located between the United Kingdom and Norway.
Declining production of some of the four North Sea crude oil grades currently used to calculate the Brent benchmark has prompted the price reporting agency, Platts, to announce that cargoes of Norway’s Troll crude oil will be included in its Brent price assessment beginning in 2018.
Offshore crude oil pipeline and transportation infrastructure systems often blend crude oil produced by several different fields into one stream, or grade, of crude oil. The crude oil marketed and sold from the system often takes the name of the most prominent field. The Brent oil field that the benchmark is named for is located in the United Kingdom territorial waters of the North Sea between the Shetland Islands and Norway. The Brent field was discovered in 1972, and production from Brent began in 1976.
Based on 2016 loadings, including Norwegian grade Troll—named after the Troll field about 40 miles off the coast of Norway—will add about 29% more crude oil volume to the current Dated Brent (BFOE) price assessment. With the inclusion of Troll, total loadings of the Dated Brent (BFOET) assessed crude oil grades would be 1.2 MMbpd in 2016.
Despite the continuing importance of the Brent price benchmark, actual crude oil production from the original Brent field will soon end after more than 40 years of production. Shell, the operator of the Brent field, has begun to decommission and remove the offshore oil platforms and the 154 wells associated with the field.
Comments