Norwegian Oil & Gas Companies Splashing More Cash In 2022, 2023
Oil and gas companies in Norway have raised their total investments for both 2022 and 2023, according to a survey by the SSB – the national statistics office.
In the previous SSB survey, the companies’ investment estimates for 2022 suggested a decrease of 8.0 percent compared with the corresponding figure for 2021. Now, these figures were upwards adjusted by 3.3 percent with oil and gas investment figures now estimated at around $18 billion for the year.
The growth is particularly related to high investment activity within the category fields on stream and exploration and concept studies. In addition, there have been two new developments in the survey since the last time.
Nevertheless, the estimate for field development is lower than in the previous survey. The main reason for this is that several developments have been completed and have come into operation so that costs and estimates for these fields in this measurement have been transferred to the category fields on stream.
With the upward adjustment in this measurement, the estimate for 2022 is 4.8 percent lower than the corresponding estimate for 2021, given in the 3Q of 2021. The indicated decrease for 2022 was in the previous measurement of 8.0 percent. It is field development that drives the decline indicated for 2022, but fields on stream and shutdown and removal also contribute negatively. The remaining main categories contribute little to the indicated change in the level of investment from 2021 to 2022.
With investments of $8.6 billion in the first half of the year, it is expected that investments rise to about $9.4 billion in the second half of the year. In that case, it will represent an increase of 5 percent from the first to the second half of the year.
Norway's temporary tax incentives for investment into new developments expire by the end of this year, and SSB believes that a large number of new PDOs will be submitted by then. The largest among these are Wisting, NOA Fulla, Krafla, and King Lear.
The newest investment forecast for oil and gas extraction and pipeline transport for 2023 is also up by 3.6 percent. The estimate for 2023 is 4.7 percent lower than the corresponding estimate for 2022. This is a lower drop than indicated in the previous survey. The estimates for 2023 then showed a drop of 8.5 percent.
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