March 19, 2020 / 10:42 AM / 4 months ago

Equinor delays Bay du Nord project off Canada after oil price crash

FILE PHOTO: Equinor's logo is seen next to the company's headquarters in Stavanger, Norway December 5, 2019. REUTERS/Ints Kalnins/File Photo

OSLO (Reuters) - Oil firms Equinor (EQNR.OL) and Husky Energy (HSE.TO) have decided to postpone the Bay du Nord project off Canada due to the fall in oil prices, the Norwegian firm said on Thursday.

The company had previously expected the project with estimated reserves of 300 million barrels to start production in 2025.

“Equinor and partner Husky Energy have decided to defer the Bay du Nord development project offshore Canada to make the project more robust for low commodity prices,” Equinor’s spokesman Morten Eek said in an email to Reuters.

“Equinor will now take the time to further improve the project business case and assess the duration of this deferral,” he added.

Equinor has made no changes to schedules of other projects, including the second phase of its giant Johan Svedrup oilfield development in the North Sea and the Arctic Johan Castberg project, Eek said. Both projects are expected to start in 2022, according to the previously announced schedules.

There hasn’t been any impact on its oil or gas production so far, the spokesman added.

Equinor is Europe’s second largest natural gas supplier after Russia’s Gazprom (GAZP.MM) and accounts for the bulk of oil production from the Norwegian continental shelf, including the share of the Norwegian state.

Oil prices rose on Thursday after falling to their lowest levels in almost two decades the previous day as central banks and governments launched measures to mitigate the fallout from the coronavirus epidemic.

Analysts, however, said the gains were likely to be temporary, as tumbling demand due to the outbreak was compounded by the collapse this month of a deal on supply curbs between OPEC and other producers.

Reporting by Nerijus Adomaitis, editing by Gwladys Fouche and David Evans

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