Technology Dispute Interrupts Statoil's Arctic Drilling Campaign

Source: Reuters 5/29/2017, Location: Europe

Statoil has interrupted drilling in the Barents Sea in the Arctic region after a court issued a temporary injunction in a technology dispute with a small Norwegian firm, a Statoil spokesman said. The Stavanger court has prohibited Statoil from using its Cap-X drilling technology after Norwegian firm NeoDrill said it was based on its patented Conductor Anchor Node (CAN) technology, which NeoDrill has been developing since 2000.

Statoil said it had to stop drilling its first exploration well in the Barents Sea this year, Blaamann, which was spudded about a week ago, while it tried to secure a lifting the injunction and prepared alternative plans if that effort failed. Statoil stepped up exploration efforts this year, focusing on the Barents Sea. According to the Norwegian Petroleum Directorate the area could hold two-thirds of all undiscovered resources off the Norwegian coast.

"We are taking steps to comply with the decision. We are currently securing the (Blaamann) well and that will take a few days to complete," Statoil's spokesman Eskil Eriksen said. Eriksen told Reuters it was unclear when Statoil could restart drilling at Blaamann, but the firm expected to complete all five wells in the Barents Sea it had planned for this year. "We will mobilize the alternative technology in time to continue the drilling, and we will complete the Barents Sea campaign as planned," Eriksen said.

Statoil said it planned to use Cap-X technology to drill all five wells in the Barents Sea, including the Korpfjell well in formerly disputed border area with Russia. When presenting the Cap-X technology to the public in April 2016, Statoil said it started its development in 2013 to help to develop resources in the Barents Sea.

NeoDrill said it contacted Statoil after the presentation showed the Cap-X having "essential parts" of CAN technology, which Statoil had access to as NeoDrill's partner since 2001 and as a 30 percent stakeholder since 2010.

"Statoil has thereby had full access to sensitive technical information related to the CAN-technology in NeoDrill," the company said in an email to Reuters. NeoDrill said Statoil had denied in 2016 using Neodrill's technology but had asked earlier this year for a licence. NeoDrill said the two were not able to agree on terms.

Statoil declined to comment on the talks, citing the ongoing court process. But the spokesman said the court's decision to issue an injunction was based on "wrong information". The Stavanger court will hear Statoil's arguments on Wednesday.


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