The Brazilian market Seen from a Norwegian Perspective

Ladies and Gentlemen, dear friends,

Brazil  is truly one of the world’s leading petroleum provinces  and Rio Oil and Gas is an outstanding meeting place for the petroleum industry.
Today’s network meeting is about how to do business in Brazil. I would like to take this opportunity to say a few words about how we perceive Brazil from a Norwegian perspective. I will also highlight some of the characteristics that Norway and Brazil have in common. Though we are separated by the Atlantic, there are many ties that keep us linked together.

Like Norway, the oil and gas industry is the backbone of Brazil’s economy.
With regard to promising discoveries and investment plans Brazil stands out. The Brazilian shelf is by far one the world’s largest offshore market, and Brazil has become a hub for exploration and production from deepwater discoveries. Important decisions are taken here and they have bearings for business opportunities worldwide.  The strong Norwegian presence in Brazil is a manifest to the importance Norway attaches to Brazil. The Rio Oil and Gas is an important arena to showcase Norwegian industry capabilities and for companies to seek inspiration and build partnerships.

There are several reasons why we should look to Brazil.  Let me highlight:

1. Brazil has clear, well-founded ambitions and do not hesitate to realize them;
• In a steadfast, continuous manner, Brazil has been growing its petroleum production.
• Investment plans are substantial and they are carried out according to schedule.

2. Brazil - with Petrobras in the forefront - has been bold in crossing technology frontiers.  Over several years, new records have been set in deepwater operations and Brazil has shown the way forward in tackling presalt deposits.

3. Research and development is given high priority, for instance Brazil has been utilizing CO2 for improved oil recovery for more than 20 years.

4. Brazil- like Norway - has a well functioning National Oil Company and we share experience from partly privatizing our NOCs.

5. Last, but not least Brazil has seen the value in developing its national industry capabilities and has succeed in doing so, for instance by co-operating with the international E&P business and offering stable framework conditions for foreign direct investments.

Even though there is no single answer to all the challenges facing a host country in the oil and gas business, I think it’s fair to say that Brazil and Norway have more things in common than separating us.

In fact, the examples of Brazilian achievements I just mentioned also reflect priorities in Norwegian petroleum policies, albeit in a somewhat different context.

I would like to underline some of the similarities:

After 40 years of production, the Norwegian Contentienal Shelf is a vibrant offshore market second only to the US Gulf of Mexico and Brazil.  Sixty percent of the expected resources remain to be produced. The agreement between Russia and Norway on the maritime delimitation line in the Barents Sea and the Polar Sea will add new areas to our continental shelf. This is very good news for future petroleum activities in Norway. 

In the past years we have seen a strong interest from the industry to explore for and develop petroleum in Norway.  Last year saw record numbers of new wells and discoveries.

The high level of activity tells me that the Norwegian Continental Shelf still is an attractive place to invest for the international oil industry. For me as minister for petroleum this is reassuring. 

Efficient and timely exploration of our acreage is a high priority for the Government. This is necessary to maintain the level of activity on the Norwegian Continental Shelf and the demand for goods and services to this sector.

Our supply industries have over many years shown ability to develop cutting edge technology and services. It is competitive globally. A tour of the exhibition here at Rio Oil and Gas should be more than enough to convince anyone who might be in doubt about this.

I am very proud of the achievements of the Norwegian petroleum supply industry.  A key objective of the Norwegian Governments petroleum policy is to create upstream - related jobs and opportunities onshore. Roughly 200.000 people - 8 percent of the workforce – all over the country are directly or indirectly engaged in providing services and goods to this industry. This clearly shows the importance of the industry and that the Government policies have been successful. 

By going international, the Norwegian industry contributes to employment and creating new interesting jobs both at home and in the host country. Besides, experience gained abroad spurs innovation that helps improve operations on the Norwegian Continental Shelf. Indeed the experience gained from Brazil is very relevant for the supply industry both in tackling challenges at home but also in other markets as the industry is growing its business globally.

I also think that Norwegian companies recognize that Brazil is wise to pursue national aspirations with regard to improving welfare, creating new jobs and developing national skills and competencies.  We share the same ambitions in Norway.  We also understand that this cannot be achieved by working in isolation. I think Brazil is showing the world that industry development is a two way process   - and I would like to assure you that Norway and the companies present here today will be part of such a process.

I think today’ seminar will demonstrate that there is a substantial potential for co-operation and I am hopeful that the Norwegian petroleum cluster  in Brazil will prove themselves to be reliable and constructive partners.

Thank you for your attention.