Norway to sustain elevated gas production until 2026 thanks to $30 billion of offshore investments
(Bloomberg) — Norway will be able to sustain gas production at last year’s elevated level until at least 2026 thanks to 300 billion Norwegian kroner ($30 billion) of investment in new offshore fields.
Norway has become the most important supplier of natural gas to Europe, following Russia’s decision to squeeze gas supplies to the continent after its invasion of Ukraine. The Nordic country’s output rose 8% in 2022 to 122 billion m3, the highest in five years, according to the NPD. It will stay at similar levels for the next four to five years, the directorate said, adding that the fuel now accounts for more than half the production from the Norwegian continental shelf.
Export revenue from Norway’s oil, natural gas and condensates reached a record of about 1.7 trillion kroner ($170 billion) in 2022. That was due to a combination of high prices, especially for gas, and greater production, the NPD’s temporary Director General Torgeir Stordal said in a presentation on Monday.
The government received 13 new field-development plans last year. Companies including Equinor ASA and Aker BP ASA rushed to take advantage of Covid-era tax breaks that expired at the end of December.
The investments will boost Norway’s reserves by an estimated 252 million m3 of oil equivalent, half of which is gas. Norwegian producers spent 120 billion kroner ($12.17 billion) investing and developing fields in 2021.
There were 11 discoveries in 2022, following the completion of 32 exploration wells. Some were smaller than expected, meaning resource growth was lower than in the three previous years, the directorate said.
“Companies must continue to further develop the fields, in part by drilling more development wells,” Stordal said. “Moreover, they should continue to explore for new oil and gas resources. This is critical to ensure that Norway remains a reliable supplier of energy to Europe longer term.”