NPD Promotes APA Scheme to Expand Exploration on Norwegian Shelf

Norwegian Continental Shelf
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In a consultation submission to the Ministry of Petroleum and Energy, the Norwegian Petroleum Directorate (NPD) concluded that the system of awards in predefined areas (APA) should continue.

"The APA scheme has functioned as intended. The arrangement contributes to more efficient exploration in mature areas and helps ensure future efficient exploitation of the resources on the Norwegian shelf," said the NPD's director of exploration, Sissel Eriksen.

In its submission, the NPD points out that the work commitments in the APA scheme have led to quicker circulation of acreage which, together with the large number of production licenses awarded, has resulted in increased exploration activity in mature areas.

The scheme has contributed to greater predictability in award policies, which has in turn given the companies a better opportunity to carry out long-term planning and a better basis for allocating resources. The APA scheme has also helped to increase player diversity.

In the fall of 2008, the Ministry of Petroleum and Energy decided to conduct an evaluation of the awards in predefined areas (APA) scheme on the Norwegian shelf. The oil industry, the fishery organizations, the environmental movement and government supervisory authorities were invited to submit their views on the APA scheme by means of a broad-based public consultation process. The deadline for comments was January 20, 2009.

The APA scheme, which was introduced in 2003, entails annual awards of production licenses in mature areas. The companies, particularly the new players on the Norwegian shelf, have shown great interest in the arrangement, while the environmental organizations have been critical of the scheme.

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