Equinor has announced increased costs and schedule delays for its Snøhvit Future development project in Norway. The latest cost estimate is NOK 20 billion, representing a NOK 4 billion increase since 2024. This is a significant rise from the original 2022 plan for development and operation (PDO) estimate of NOK 13.2 billion, or NOK 14.7 billion when adjusted for 2025 inflation.

Project Purpose and Revised Timeline

The Snøhvit Future project has two primary objectives: implementing onshore compression to maintain production at the Hammerfest LNG facility, and electrifying the plant to reduce its annual CO2 emissions by 850,000 tonnes. The start date for the onshore compression component has been delayed by one year and is now scheduled for 2029.

Reasons for Cost Increases and Delays

Equinor cited several contributing factors. These include worse-than-normal winter weather in 2024 and 2025, increased engineering costs, high inflation, and an extended summer 2025 turnaround at the Melkøya site which delayed the resumption of project work. The company acknowledged that its estimates were not finalized in time for Norway's autumn budget process, but it had communicated that investments would rise.

Execution Challenges

The project is reported to be approximately halfway completed. Executing a major project within an operating plant has proven demanding. Specific challenges included underestimating the complexity of planning and executing the project alongside an extensive turnaround at Melkøya this year, as well as temporary safety shutdowns that affected progress.