LNG

The Norwegian Ministry of Petroleum and Energy has awarded 61 upstream licences in pre-defined areas of the Norwegian Continental Shelf to 30 licensees, including prominent LNG players such as BP, Shell, Total and Eni of Italy, as well as ConocoPhillips, the only bidder among US majors.

“I am pleased to offer 61 new production licenses in this year's round to a diverse range of companies,” said Tina Bru, Norway’s Minister of Petroleum and Energy.

“These companies have shown great interest in gaining access to new exploration acreage, illustrating the industry's confidence in continued profitability from exploration, which is good news for the Norwegian state as the resource owner,” added Bru.

Of the 61 production licences taken up, 34 are in the North Sea, 24 in the Norwegian Sea and there are three in the Barents Sea.

A total of 18 companies have been offered one or more operatorships.

The licences were awarded with work-programme commitments or as additional areas of activity.

“Exploration to provide additional discoveries is vital in order to maintain a high level of activity, employment and revenue over time for Norway's largest industry,” explained the Minister.

“I now eagerly await the commencement of activity and the resulting discoveries,” stated Bru.

The first licensing round on the NCS took place in 1965. The activity started in the North Sea, and exploration in the Norwegian Sea and the Barents Sea started around 15 years later.

Norway is the main pipeline natural gas supplier to Europe, along with Russia’s Gazprom, in competition to LNG deliveries from nations such as Qatar, the US, Nigeria, Algeria and Trinidad and Tobago, as well as Russia.

The Minister noted that since the first oil and gas discoveries, the NCS has contributed more than 15.70 trillion Norwegian crowns ($1.85 trillion) in value creation.

It has also given the Norwegian state a net cash-flow of over 6.70 trillion crowns ($785Bln) since the year 2000.

Norway’s net cash flow from the petroleum sector in 2021 is forecast as amounting to around 99Bln crowns ($11.60Bln), which equates to an income of 75,000 crowns ($8,800) for each Norwegian family of four.

“An active exploration policy, including regular licensing rounds on the NCS will facilitate new discoveries,” said the Ministry.

“This in turn will contribute towards securing state revenue, value creation and employment, all of which is important in order to maintain Norway's welfare over time,” it stated.

The Ministry noted that petroleum activity on the NCS is conducted with great emphasis on health, safety and the environmental standards.

“Exploration, development and production takes place with low emissions to air. The greenhouse gas-emissions are also part of the European Union Emissions Trading System (ETS),” it added.

The Ministry said that the probability of an oil-well blow-out is extremely low, and there are strict requirements in place for emergency preparedness to reduce the consequences in the event of an accidental oil spill.

“During 50 years of petroleum activities, no accidental oil spills have reached Norwegian shores, and no damage to the marine environment has been proven,” it said.

The big winners in the licensing round include German oil and gas company Wintershall Dea, which was awarded interests in 16 Norwegian blocks, including four as operator.

Italy’s Eni said the jointly-owned venture company Var Energi, in which the Milan-based company has a 70 percent stake and the balance is held by European energy investment firm HitecVision, was awarded 10 exploration licences.

Licence stakes awarded/and with operatorships: Aker BP (10/8); AS Norske Shell (1/1); Chrysaor (6/3); Concedo (1/0); ConocoPhillips (4/3); DNO (10/4); Edison (2/0); Equinor (17/10); INEOS (4/1); Inpex (2/1); Kufpec (1/0); Lime (4/0); Lotos (3/0); Lundin (19/7); MOL (1/1); M Vest (2/0); Neptune (6/3); OKEA (6/4).

OMV (3/3), One Dyas (6/0), Pandion (5/0); Petrolia NOCO (3/1); PGNiG (4/0); Source (4/0); Spirit (3/0); Sval (5/1); Total (3/0); Var Energi – Eni (10/5); Wellesley (2/1) and Wintershall DEA (16/4).