(Bloomberg) -- Norway, western Europe’s biggest oil and gas producer, warned companies that failing to extract less profitable barrels could weaken their chances of getting exploration blocks in a new area of the Arctic Barents Sea.
“There are rights and duties associated with having a position on the Norwegian shelf,” Bente Nyland, the head of the Norwegian Petroleum Directorate, said at a Norwegian Shipowners’ Association seminar in Oslo Thursday. “We don’t want companies that skim the cream. We will be very clear on that when we now consider awards in the next licensing round.”
Some resources could be lost forever if they’re not developed in time as companies cut investments and delay or cancel projects because of a slump in oil prices, said Nyland. Statoil’s Snorre 2040 and Trestakk projects are examples of such resources, the head of the industry regulator said.
Norway’s government and the NPD have repeatedly warned oil companies not to forgo marginal projects like increased recovery on aging fields as they become more selective in their spending to counter a collapse in crude prices. Time-critical resources risk being lost at a time when the Norwegian state’s income is already being eroded by lower oil prices.
Norway plans to next year award new licenses in the south- east region of the Barents Sea, the first new area to be opened to oil exploration since the mid-1990s. The 23rd licensing round has drawn “significant interest” from oil companies, Petroleum and Energy minister Tord Lien said in an interview.
Statoil, which is expecting to make a concept decision on Trestakk this year and one on Snorre 2040 in the fourth quarter of 2016, believes it’s handling those resources in a “responsible” manner as it spends the time necessary to make the projects profitable, spokesman Morten Eek said by e-mail.
“Statoil assumes that the quality of the application we’re working on is the most important thing when it comes to the 23rd round,” he said. “We’ve already drilled the acreage we were awarded in previous rounds and we’ve demonstrated we don’t sit on the acreage, but explore it as soon as possible.”
To contact the reporter on this story: Mikael Holter in Oslo at email@example.com To contact the editors responsible for this story: James Herron at firstname.lastname@example.org Stephen Treloar, Jonas Bergman.
Copyright 2017 Bloomberg News.
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