The shelf in 2006 - Activity level
05/01/2007 We are currently experiencing a period of vigorous activity on the Norwegian shelf. Higher oil prices have brought significant increases in both activity level and costs. Investment trend prognoses up to 2011 indicate that activity will remain high. A number of modification and improved recovery projects on producing fields (Ekofisk, Eldfisk, Snorre, Troll oil and Valhall), together with new developments (35/9-1 Gjøa and 6507/5-1 Skarv), contribute to the vigorous activity.
Investments in 2006 are estimated at 85 billion 2006-NOK, excluding exploration costs. This is 2.5 billion (three per cent) more than the forecast made in the spring of 2006.
Three plans for development and operation (PDOs) and three revised plans were approved during 2006. Three applications for PDO exemptions were also approved.
For 2007, the investments excluding exploration costs are expected to amount to 82 billion 2006-NOK. An estimated NOK 23 billion will be expended in connection with exploration.
Around eight PDOs for development of discoveries are expected to be submitted to the authorities in 2007. Revised PDOs are also expected for several producing fields. Re-opening of fields that have previously been shut down may also be relevant.
For the next five-year period, total investments are expected to amount to around 478 billion 2006-NOK. This represents an upward adjustment of 134 billion for the same period as compared with the investment prognosis in 2006.
The future investment level on the Norwegian continental shelf is subject to substantial uncertainty. This applies particularly to the timing of phasing in projects which have not yet been approved, sharp price increases for goods and services and in general, as well as changes in cost levels for both approved projects and projects that have not yet been approved.
During the period 2007 – 2011, expectations are that nearly 50 percent of the investments will be used to modify and build new facilities. Just over 40 percent of the investments will likely be used to drill exploration wells, while about 10 percent will be used for pipeline and onshore facilities.
Operating costs, excluding CO2 tax and tariffs, amounted to NOK 38 billion in 2006. Operating costs are estimated at NOK 42-44 billion per year during the 2007 - 2011 period.
Updated: 14/12/2009