Norway Reduces Output by 150,000 Barrels

The Norwegian Government has decided to reduce crude oil production by 150,000 barrels per day from January 1 until June 30, 2002. The decision to reduce Norwegian oil production is unilateral. The measures are not part of any formalized agreement with OPEC or producers outside OPEC. The Norwegian measures will likewise be suspended on a unilateral basis if other countries do not implement announced measures, if the measures do not have the desired effect or if our evaluation of the oil market situation deems it necessary.

Mr. Einar Steensnæs, Minister of Petroleum and Energy, stated that the decision to reduce the oil production is intended to help stabilize the crude oil market and prevent oil prices from falling to very low levels. Norway is aiming at an oil price level that is reasonable for both oil importing and oil exporting countries.

Based on the latest estimates from the operating companies and an overall assessment done by the Ministry of Petroleum and Energy and the Norwegian Petroleum Directorate, the average oil production for the first 6 months of 2002 is estimated to be 3.17 million barrels per day. After a reduction of 150 000 barrels per day, the allowed average production for the first 6 months in 2002 will be 3.02 million barrels per day during this period. The reductions will in principle be applied equally and in a non-discriminatory fashion to all companies operating on the Norwegian continental shelf.

All oil producing fields will be subject to a proportional reduction in production, except two fields that Norway share with the United Kingdom (Statfjord and Murchison), and one small field that is soon to terminate production (Varg). Gas and condensate fields will not be subjected to reduction.