Sustained High Activity on the NCS in the Years to Come

The Ministry of Petroleum and Energy prepares, on a yearly basis, estimates for the activity level on the Norwegian continental shelf. The estimates are based on data from the oil companies and evaluations made by the Norwegian Petroleum Directorate and the Ministry of Petroleum and Energy.

An oil price of 200 Norwegian kroner/barrel is estimated this year. Next year the estimated oil price is 180 Norwegian kroner/barrel. Compared to the National Budget for 2004 this is an increase of 30 kroner both for 2004 and 2005.

The average production of Norwegian crude oil (including NGL) is expected to be 3.2 million barrels per day in 2004, approximately the same as last year. The production is expected to stay at this level for the next few years followed by a gradual decline.

Gas sales in 2004 are estimated to approximately 75 bill scm. In 2003 gas sales were 73.4 bill scm. Gas sales are expected to increase towards a long term level of 120 bill scm per year from 2010. This is an increase in the long term sales volume by 10 bill scm per year compared to previous forecast.

Investments in 2004 are estimated to around 71 billion Norwegian kroner, an increase from 2003 by more than 10 percent. Investments in exploration are not included. The high investment level is to a large extent due to the Ormen Lange project, which was approved by the Storting this spring and will start investments this year. In addition the Snøhvit- and Kristinfields, both under development, are large contributors to the high investment level.

Over the next years, the investment level is expected to remain at a high level. For the period 2004-2008, investments in the petroleum industry are expected to be almost 300 billion. This is an increase compared to earlier figures. Compared to the National Budget for 2004 investments in 2004 are lower. For the next decade (2004-2013) the total increase is more than 70 billion (real 2004-kroner). This increase is due to expectations of higher gas sales, more new projects starting up, and more projects related to increased oil recovery.