Press Release

No.: 61/99
Date: 04.10.99

Norwegian petroleum sector 2000

The State's revenues from the petroleum activities in year 2000 are estimated to be 85 billion NOK. This is 38 billion NOK higher than the estimate for 1999.

The estimate is based on an oil price of 125 NOK per barrel in 1999 and 2000. The value of total export from the petroleum operations is estimated to increase by 34 billion NOK from 1999, to 191 billion NOK.

The average oil production on the Norwegian Continental Shelf is expected to increase by about 500.000 barrels per day from 1999. The production forecast for 2000 is 3.5 million barrels per day. This estimate is based on the official regulation of production, effective until 31.12.99. The State, by the State's Direct Financial Interest (SDFI), is estimated to produce about 1.5 million barrels per day. The gas export from the Norwegian Continental Shelf is expected to increase with 9 billion scm from about 52 billion scm in 1999 to about 61 billion scm in 2000.

The investment level in petroleum operations is expected to fall. In 2000, investments are estimated to be about 43 billion NOK, while they are estimated to about 67 billion NOK this year. Exploration drilling and exploration investments in the petroleum operations are included in this estimate. The investments in 2000 are mainly decided by the plans for fields in production, and approved field developments.

The State's net cash flow from the petroleum operations is estimated to be 85 billion NOK in 1999. Of this, 35 billion NOK are taxes and fees, and 48 billion NOK is net payments from the SDFI. Dividend from Statoil is estimated to be about 2.3 billion NOK in 2000.

The international oil market in the winter/spring of 1999 was characterized by low oil prices caused by high stocks levels and uncertainty concerning the economic development in Asia. In order to reduce the production surplus and the falling prices, a number of countries have reduced their oil production. The production regulation was implemented by a reduction of 100.000 barrels pr day on the Norwegian Continental Shelf from 1 January. This was a continuation of the production regulation from 1 May 1998. Effective from 1 April this year the production was further reduced by an additional 100.000 barrels through the rest of 1999.

The initiative from the countries both within and outside of OPEC has changed the market balance substantially. Global oil stocks will be significantly reduced on an annual basis, which is confirmed by temporary available statistics. Due to the change in market balance, the prices have more than doubled since February this year.

Contact:
Sissel Edvardsen, +47 22 24 61 09