Norway to Stay Europe's Oil & Gas Leader

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Written by Martin Lynch, European News Editor for Industrial Info (Galway, Ireland)--Norway will be the major destination for European oil and gas investment in the near future, thanks to a number of new development projects.

New figures show that Europe's offshore drilling expenditure is on the rise at an average annual growth rate (AAGR) of 6.9%, which will boost investment from approximately €7.6 billion (US$10 billion) in 2013 to €9.7 billion (US$12.8 billion) in 2016. Norway alone will be responsible for over a third of that total with €3.8 billion (US$5 billion) followed closely by the U.K. with investment reaching €3 billion (US$4 billion) by 2016.

Combined, Norway and the U.K., lead Europe in terms of offshore Exploration and Production (E&P), along with drilling investments and activity, accounting for around 75% of the total offshore drilling expenditure in the European region, according to GBI Research. Denmark and the Netherlands follow behind as the countries with the next greatest number of oil wells.

The news arrives in the same month that the Norwegian government, through its Norwegian Petroleum Directorate (NPD), announced that it has granted permission for the deployment of two drilling rigs in its territorial waters. Consent was granted to Det Norske (Trondheim, Norway) to begin exploration drilling for 60 days in the southern region of the North Sea. Lundin Petroleum (Stockholm, Sweden) also received consent to use a mobile drilling platform to explore for resources in the central waters of the North Sea.

Norway expects to find a lot more oil and gas than previously expected, according to the latest findings from the Norwegian Petroleum Directorate. It believes that the undiscovered resources on the Norwegian shelf will be larger than previously thought, due to the greater number of companies allowed to explore there, following Norway and Russia's agreement on a new demarcation line in the Barents Sea.

"After the authorities adjusted the exploration policy and, among other things, let new players enter the game about ten years ago, the number of players on the Norwegian shelf has almost doubled," explained Sissel Eriksen, director of exploration in the Norwegian Petroleum Directorate. "This has resulted in a high level of exploration activity and many discoveries have been made. The most important reason is that new knowledge results in greater faith in the possibilities of finding more. There is still a lot of oil and gas to discover in the North Sea, Norwegian Sea and Barents Sea."

Today, there are 76 fields in production on the Norwegian continental shelf. In 2012, these fields produced about 1.9 million barrels of oil (including NGL and condensate) per day, and about 111 billion standard cubic metres (Sm3) of gas. Norway is ranked as the seventh largest oil exporter and the fourteenth largest oil producer in the world. In gas, Norway was the world's third largest gas exporter and the world's sixth largest gas producer in 2011.

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