Oil decline continues – the industry looks toward the north

Oil platform, trade surplusOil platform.Photo pixabay.com

The fall in oil investment will continue in the coming years, according to the economic report by the Norwegian Oil Industry Association. The industry is casting a long glance towards Lofoten.

– While last year’s report projected a turning point upward for investments from 2017, we are now seeing a leveling off of the level of investment for years after, it says in the report that was published Monday.

The Norwegian Oil Industry Association’s main scenario is based on an oil price of around 50 dollars a barrel and said that investment on the Norwegian continental shelf this year will end at 154 billion.

Investments peaked in 2014, with over 215 billion.

Next year petroleum investment is expected to fall to 143 billion and further to 131 billion in 2018. Activity is expected to pick up somewhat to 137 billion in 2019, before the investments are expected to drop again to 127 billion in 2020 and 126 billion in 2021.

Less than half of the Norwegian oil and gas resources have been taken up.

The future lies in the north, says CEO Karl Eirik Schjøtt-Pedersen from the Norwegian Oil Industry Association.

– In the waters off Lofoten and Vesterålen there could be significant resources. An impact assessment should be implemented in the next parliamentary term. We are also looking at potential in the Barents Sea, says Schjøtt-Pedersen.

He is delighted that the efforts to reduce costs seem to work, which makes the industry better prepared than before to cope with oil prices at current levels. A barrel of North Sea oil was on Monday traded at $ 57.


Source: NTB scanpix / Norway Today