Last year was a record year for the Norwegian Continental Shelf (NCS) and the boom is set to continue for another five years.
That is according to the Norwegian Petroleum Directorate (NPD), which said the NCS saw record investment and spending, high levels of exploration and the biggest find in 2011. Just under £16.2billion was invested and 22 new oil and gas discoveries were made, including one of the largest in years.
The number of exploration wells rose from 41 in 2010 to 54 in 2011 and last month the largest number of exploration licences were handed out since oil firms first started hunting for hydrocarbons on the NCS.
With the NPD predicting the boom will continue for the next five years, Norway is looking an attractive place to be – for operators, contractors and suppliers.
The NPD is also optimistic there is still great potential for more discoveries on the NCS – in frontier and mature areas.
Aberdeen-based Faroe Petroleum, which first entered Norway in 2006. has the same view. Five of six exploration wells in its drilling campaign this year will be offshore Norway.
It also just won a further seven exploration licences on the NCS.
Graham Stewart, its chief executive, said the combination of an
attractive fiscal regime for explorers, availability of licences with annual licensing rounds, availability of quality staff, established infrastructure and a ready market to help develop discoveries made the region attractive.
The fact the NCS is less heavily drilled than the UK North Sea was also attractive, he said.
“Norway has all these things. There is attractive geology and more acreage. Twice the number of wells have been drilled on the UK Continental Shelf, which means in a way Norway is about 15 years behind the UK. This means there is a lot more to come.”
According to the NPD, investments in the petroleum industry could increase by 40% from 2010 to 2012, including exploration costs.
In 2011, just under £16.2billion was invested. This is expected to increase to £18.3billion in 2012, with a moderate growth towards 2016.
Goliat, the first oil field discovered in the Barents Sea, is being developed by ENI and is due on stream in 2013.
The NPD says Conoco-Phillips has plans to develop and operate Ekofisk Sør and Eldfisk II, which would contribute to 40 new years of recovery from the area.
Lundin and Det norske oljeselskap are looking to develop the Luno and Draupne fields, respectively, on the Utsira High in the North Sea, it said.
Here, it is thought coordinated development could help increase value creation from the fields. Total is also due to submit plans for its Hild development, an oil and gas discovery proven in 1978, said the NPD.
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