Innlegg på Internasjonal Oil & Gas Business Days

                                                        Check against delivery

 

• An-nyeong-ha-shim-nika (Korean formal greeting. Translates as «How are you?»). How was my pronunciation? I hope it was not too bad.  

 

• It is a pleasure for me to open INTSOK’s 12th International Oil and Gas Business Day. It gives me the opportunity to address this distinguished audience of international players in the oil and gas industry.

 

• INTSOK, which is the organizer of this event, was established 16 years ago by the Norwegian Government and industry to promote Norwegian oil and gas in international markets.

 

• During these years the petroleum industry has been extremely successful, and has grown its revenue in international markets many times. The Ministry of Petroleum and Energy fully supports INTSOK’s engagement with industry.

 

 

Petroleum policy

• Let me start with some words about important principles on which the Norwegian petroleum policy is based.

 

• Resource management shall be carried out in a long-term perspective, for the benefit of the entire Norwegian society. This has been the foundation for the management of our petroleum resources for the past 50 years.

 

• In this regard the resource management shall provide revenues to the country, and shall contribute to:

 

• ensuring welfare
• employment
• an improved environment
• the strengthening of Norwegian trade and industrial development
• and take due regard to regional and local policy considerations

 

• These principles are agreed upon by our political parties and are included in our Petroleum law.
• Our management of the petroleum resources has been a success. Today, the petroleum activity is Norway´s largest industry measured in value creation, state revenue and export value.

 

HSE

• I would also like to emphasize that we have a strong focus on health, safety and environment in Norway. This is the foundation for all our activity.

 

• The Government and the Norwegian people must be able to trust that petroleum activities take place in a safe and sustainable manner. This is an important part of the companies’ license to operate.

 

• A continuous improvement in the fields of health, safety and environment must therefore be pursued and reinforced.

 

 

The future of the Norwegian Continental Shelf

 

• Currently, 78 fields are in production on the Norwegian Continental Shelf. Last year, these fields produced about 1.9 million barrels of oil (including NGL and condensate) per day, and 115 billion standard cubic meters (Sm3) of gas.

 

• The Norwegian Petroleum Directorate’s base estimates for discovered and undiscovered petroleum resources on the Norwegian continental shelf, amount to approximately 13.6 billion standard cubic metres of oil equivalents, or about 85 billion barrels. Of this, about 40 percent has been sold and delivered.

 

• To sum up – there is still a substantial resource potential on the Norwegian Continental Shelf!

 

• In 2011, the Government proposed an updated strategy for the petroleum sector in a White Paper. The White Paper received support from all political parties in Parliament.

 

• The White Paper emphasizes that maintaining a high production level from the Norwegian continental shelf is very much achievable. Therefore, we have pledged an active commitment to:

 

• increase the recovery rate in existing fields
• develop all commercial discoveries
• continue to explore
• and to  open new areas for exploration

 

• The average expected recovery rate on the NCS is 46 per cent for oil and 70 per cent for gas. This is a high recovery rate compared to recovery rates in other petroleum provinces around the world.

 

• There is still a significant potential for increased oil recovery from the NCS. 1 percentage point increase in the recovery rate for fields that are currently operating will increase production with approximately 570 mill barrels of oil.

 

• I know that increased oil recovery is high on the industry’s agenda, and that the licensees are continuously working to realize the value potential. Accordingly, we as a resource owner must follow-up and support the industry in this effort. Therefore, we have recently decided to establish a dedicated research centre for improved recovery.

 

• We have also announced the location of a new research centre for petroleum activities in Arctic areas.

 

• Furthermore, in June we opened, for the first time since 1994, new areas offshore for oil and gas activities. This is the southern part of our new waters in the Barents Sea, following the delimitation agreement with Russia in 2010.

 

• There are currently more that 20 oil and gas fields under development on the NCS and the activity level in the Norwegian petroleum sector is high.

 

• Thus, operators have over the last years awarded major contracts to yards in South Korea and Singapore.

 

• It is essential for all involved, including operators, suppliers and the Norwegian Government, that new developments are delivered on time, on cost and according to specifications.

 

• On average, 50 per cent of the content of topside contracts is procurement.

 

  Technology development and the industry today

 

 

• In Norway, we have a very competitive petroleum industry with world class technology and expertise. The industry has 40 years of experience solving challenges on the Norwegian Continental Shelf.

 

• Fields have often been in deep waters, or located in remote areas with no infrastructure in place. Technological development has been necessary to make fields economically viable, or possible to develop at all.

 

• The engagement and interaction between oil companies, industry and research institutions have been fundamental in finding solutions to technological challenges.

 

•  I am truly proud of the way these players have collaborated, and by how they are bringing world class technological solutions to the international market.

 

•  My message is clear - Norwegian industry have a lot to offer! They know the requirements and standards on the Norwegian Continental Shelf. They have the technology and they have the expertise. Therefore, I believe that Norwegian companies are well positioned in the competition for contracts on installations destined for the NCS.

 

Avslutning

 

• In INTSOK’s newly published (June 2013) Annual Market Report, growth is expected in major markets for the Oil-and gas Service industry.

 

• For 2014 through 2017, the Norwegian offshore market is forcasted to be the second biggest in the world after Brazil. The US Gulf of Mexico, the UK, Australia and Angola are also major markets for the industry. I am sure you will hear more about this throughout the seminar.

 

• My final message today - Remember that in times with such high activity, we must never compromise on quality, schedule and cost.

 

• Thank you for your attention and good luck with the conference!