The Norwegian budget shows that the costs of Aker's offshore projects are rising.

Norway's Budget Proposal showed that the cost of Aker BP’s major oil and gas projects, Yggdrasil, and Valhall-Fenris have risen 32% and 25% respectively from nominal estimates a month ago.

The Yggdrasil Project, the largest development project off Norway since 2019 is expected to cost 177.6 trillion crowns ($17.59billion), an increase from a nominal estimation of 134.4 billion a year earlier.

The cost of building a new platform to process gas from the Valhall field of Aker BP, combined with the development and production of nearby Fenris, has increased by 75.9 billion Crowns. This is up from the nominal estimate of only 60.9 billion Crowns.

Aker BP stated in a separate press release that the costs were higher due to a weakening crown currency against the U.S. Dollar, increased inflation, a tighter supplier's market, and the addition to the Yggdrasil project of the East Frigg find.

The company said that both projects will still start production in 2027. Reporting by Nerijus Adomiaitis and editing by Gwladys Faouche.

(source: Reuters)