News04.12.2009 08:00
Activity remains high, but uncertainty has increased
An English report of the OLF business trend report can be downloaded from this article.
Investment on the Norwegian continental shelf (NCS) will remain high for the next few years, according to the latest business trend report from the Norwegian Oil Industry Association (OLF). But uncertainty over future capital spending has grown.
“A record level of activity in the petroleum industry has helped to protect the Norwegian economy from the global financial crisis,” notes Per Terje Vold, chief executive of the OLF.
Download the OLF business trend report here.
The 2009 business trend report, presented on 12 November, is entitled Light at the end of the tunnel – for the Norwegian petroleum industry as well?
That reflects the fact that the world appears to be heading for better times, while Norway’s oil and gas sector faces a number of important challenges.
Recovery
After the deepest recession since 1945, the OLF believes that the world economy is on the way to recovery. But Mr Vold notes that the upturn is fragile.
“Little suggests that we face a rapid return to high growth rates. Energy market developments will accordingly continue to be characterised by uncertainty in the time come.”
The investment analysis presented in the business trend report indicates that capital spending on the NCS could peak at NOK 129 billion this year. By comparison, Norway’s mainland industry invested a total of NOK 35 billion in 2008.
Petroleum investment could remain around NOK 100-120 billion in 2010-13. But a decline in 2010-11 before a recovery begins could nevertheless present a challenge to the level of activity at suppliers.
“Uncertainty over these forecasts has increased,” says Mr Vold. “Projects which were financially robust with a high oil price are being reassessed now that the price has halved.”
Policy
In the OLF’s view, the biggest challenge for the Norwegian petroleum industry is the lack of an oil policy and clear political signals in recent years. Norwegian oil production will have almost halved in 2013 from its 2001 peak.
The OLF notes that the centre-left coalition government re-elected in September has promised a new review of petroleum policy in a separate White Paper, six years after the last such document was presented. The whole petroleum industry wants clear signals.
“We need a long-term approach by the government,” Mr Vold emphasises. “A number of discoveries are still being made on the NCS, but they are generally small.
“This trend can probably be attributed to the fact that no new areas have been opened for petroleum activity on the NCS for 15 years.
“Additional exploration acreage is essential if the petroleum industry is to continue contributing as strongly as before to making Norway the world’s best country in which to live.”
Further information from:
Per Terje Vold, chief executive, OLF, mobile: +47 91 61 77 26
Sigbjørn Aanes, communications manager, OLF, mobile: +47 92 88 78 86
Norsk versjon
