NPD will not Award IOR Prize for 2002

Unfortunately, the Norwegian Petroleum Directorate did not find a candidate worthy of the IOR prize for the year 2002.

Much good work was carried out in 2002 to improve recovery from several fields on the Norwegian continental shelf. However, the measures implemented were necessary in order to maintain production levels in line with already approved plans and they have not led to increased production beyond this. Potential new recoverable resources are being delayed and could possibly be lost.

A considerable volume of resources will be left behind in the fields after planned field cessation. The potential value creation could be enormous - if we can extract more of this volume. The authorities' goal is an average recovery rate of 50 percent for oil and 75 percent for gas.

Storting White Paper No. 38 describes two potential development paths for oil and gas production from the Norwegian shelf. Under the "decline path", production will decline up to 2020. This includes only anticipated production from projects that have already been approved. Under the "long-term development path", production will be maintained at a considerably higher level. This scenario entails realization of an anticipated estimate of undiscovered resources, and that the authorities' recovery rate target is achieved.

It appears that the trend among the oil companies is to give priority to short-term measures to increase production from day to day and to increase the next year's production. This trend continued in 2002, despite the high level of oil prices. The NPD feels that there is a lack of willingness to invest in the future, with a determined commitment to research, development of technology and testing of pilot projects. It was this type of commitment that created the significant additional volumes from the fields on the Norwegian shelf in the 1980s and 1990s.

We hope and believe that a prolonged high oil price will lead to faith in the future and the willingness to stretch further to grasp the considerable volumes to be found in already developed fields. This will also give us the opportunity to find worthy candidates at the next crossroads, at the end of 2003.

The Norwegian Petroleum Directorate's prize for improved oil recovery, the "IOR" prize, was first awarded in 1998. ("IOR" is an abbreviation for Improved Oil Recovery"). The prize has been awarded four times as a recognition of creativity, steadfastness and the willingness to take risks when it comes to using methods and technologies that can improve recovery beyond what can be expected with the existing incentives.

Previous prize winners:

1998 – Norsk Hydro: The Troll oil field, our largest oil-producer in 2002, became a reality because of a few people's faith that there was more to be realized here than gas production

1999 – Saga: Foam/soap used to stop unwanted gas production and thus increase oil production on the Snorre field

2000 – Phillips Petroleum Company: The Ekofisk field received the prize for implementing studies and making decisions in favor of "improved recovery projects", also during periods when oil prices were low

2001 – Statoil and Egil Sunde: For their pioneering use of bacteria to improve recovery on the Norne field, the first time ever on an offshore field