The cost of Aker BP’s major ongoing oil and gas development projects, Yggdrasil and Valhall-Fenris, has increased by 32 per cent and 25 per cent respectively from nominal estimates made a year ago, according to Norway’s budget proposal released on Wednesday.
The Yggdrasil project – the largest development offshore Norway since 2019 – is now expected to cost NOK177.6 billion (US$17.59 billion), up from a nominal estimate of NOK134.4 billion a year earlier.
Meanwhile, the project to build a new processing platform for Aker BP’s Valhall field, combined with the development of the nearby Fenris gas discovery, will now cost NOK75.9 billion, compared with the previous estimate of NOK60.9 billion.
Aker BP said in a separate statement that the higher costs, measured in 2025 crowns, were due to the Norwegian crown weakening against the US dollar, higher inflation, a tighter suppliers’ market, and the inclusion of the East Frigg discovery in the Yggdrasil development.
Both projects are still expected to begin production in 2027, the company added.
(Reporting by Nerijus Adomaitis; Editing by Gwladys Fouche)
