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ENERGY WORLD: IT IN OIL AND GASStavanger Forum, 15 March 2018
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NORWEGIAN OIL :SCEPTICISM THAT TURNED INTO A
GREAT BLESSINGBy
Farouk Al-Kasim
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1. Effectiveandprudentnationalsteering.2. Highlyrespectedandeffectivestateadministrationofthesector.3. Constructivecooperationbetweentheauthoritiesandthelicensees.4. Varietyamongthelicenseesthathasenhancedbothefficiencyand
creativityinoperations.5. Ahighstandardinhealth,safetyandenvironmentalprotection.6. Aspectacularincreaseinoilrecoverywhichiswayoverworldaverage.7. Ahighdegreeofnationalparticipationinpetroleumoperations.
8. Fullsuccessinmitigatingthe Nocorruption.
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1963: OilcompaniesapproachedNorwayenthusiasticallytoobtainconcessionsdespiteNGU’srefusalofthepossibilityforHCs.
1965: IntheFirstRound,78blockswereallocatedonattractiveterms.
1966: ThefirstwellwasdrilledontheNorwegiansideoftheNorthSea.
1968: NoncommercialcondensatewasdiscoveredintheCodFieldbyPhillips.LuckyformeIarrivedinNorwayonMay28th thatyear.
1969: Ekofiskdiscoveryatendof1969removedalldoubtsonoilwealth.
1971: TheStortingadoptedthe10OilCommandments.
1972: NPDandStatoilwereestablishedwithdistinctlyseparateroles.
1974: WhitePaperNo.74warnedNorwayagainsttheOilCurseandurgedprudenceinavoidingrapidpaceinlicensing.
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§ In , Oil Minister and his State Secretary proposed a draft petroleum policy in 10 points.
§ The draft was discussed with the Industry Committee and later agreed by the .
§ The event represented three world class miracles:
1. Politiciansinademocraticcountryagreedswiftlyandunanimouslyonpolicyprinciplesformanagingpetroleum.
2. Allpoliticalpartiesvowednevertodiscusstheprinciplesofthepetroleumpolicyduringelectioncampaigns.
3. Allpartieshavesofarkepttheirvows.
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1. Ensure of petroleum operations.
2. Secure Norway’s .
3. Establish on the basis of oil.
4. Protect the and .
.
6. As a rule, crude oil and gas shall be .
7. The state shall actively co-ordinate Norwegian interests towards an with national and international objectives.
8. Establish a to look after the state's business interests and co-operate constructively with national and foreign oil interests,
9. Develop a suitable approach for areas north of the 62nd parallel.
10. Petroleum success will present to Norway’s .
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topetroleumoperationsreflectedagenuinefearthatNorwaywillbeoverwhelmedbyoiloperations.
§ Politicalconsensusontheneedforstrongnationalcontrolwasthemainreasonforthe (1971).
§ For10yearsaftertheEkofiskdiscovery,(1970until1980),Norwaymaintaineda policytoensure topetroleumoperations.DONTRUSHwastheslogan.
§ WhitePaperNo.25of bytheMinistryofFinancewarnedthenationagainstthedangersofthe andre-iteratedtheneedfora
inlicensingtoprotectNorwayagainstthesethreats.
§ Asthenationaleconomyadjusteditselftopetroleumactivitiesinthe1980s,thefocusturnedfromkeepingamoderatepaceinlicensingtomaintaininga“ ”inthepetroleumsector.Theobjectiveinthe1980swastoavoidshockstotheeconomy.
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§ The (1982-83)recommendedthattherestrictionsonthetempooflicensingcouldbegraduallyeasedoff.Butitalsoproposedtheestablishmentofan“ ”wherethepetroleumrevenuecouldonlybe
topreventariseinlocalspending.§ Thefinancingofnationalparticipationinpetroleumoperations
totheTreasuryby .Forthisreason,theOilFundwasnotestablisheduntil .TheFundwasagaininstructednottoinvestinNorway.
§ In2005,the wasrenamedthe .ThenameagainemphasisedthattheFundwasnotallowedtoinvestinNorway.
§ ThereispoliticalconsensusinNorwayonwhatiscalled“ ”.Therulestatesthatthenationalbudgetispermittedtohavea oftheorder
atthe ofanygivenexcluding .
§ In ,the4%deficitwasreducedto tobeonthesafeside
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NON-OIL SECTORS OF THE INDUSTRY§ Inthe10OilCommandments,theStortingwas onusing
oilasa tothedevelopmentoftheNorwegianindustry.§ The in ledtoablossomingperiodin
theNorwegianindustryandinresearchanddevelopmentinstitutes.
§ Thepolicyof inlicensinghelped ofoiloperationsonnon-oilsectorsoftheNorwegianindustry.
§ Moreover,theroleplayedbythe inplanningthenationaleconomyhelpedminimisethepotentialdamagestotheeconomyasawhole.
§ Asanexample,aprudent hashelpedpreservecompetitivenesstothenon-oilsectorsoftheeconomy.
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PROACTIVE CONSEQUENCE EVALUATION
hasenabledNorwaytosafeguardthelong-terminterestinitsplanning
§ Controllingthe throughthelicensingpolicyhasthusensureda whichis
.§ Insistenceon aheadthestartof
petroleumoperationshasbeena inNorwegianlicensingpolicy
§ Thefocusonhealth,safetyandenvironment hasalmosteliminatedaccidentsinoperationsontheNorwegianContinentalShelfsincethe70s.
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OFFSHORE INDUSTRY
§ From theoilcompanieswererequiredtouseNorwegiangoodsandservicesaslongasthesewere
§ The inpetroleumoperationsinthe1970sgavetheNorwegianOffshoreIndustrysufficienttimeto
inoffshorepetroleumoperationsandsoontocontributetothe .
§ The quicklylearnedtheoilbusiness.Subsequently,theycontributedtodevelopinglocalcontentbyprovidingtheoffshoreindustrywith
intheNorthSea.§ Today,Norwayenjoys fromitsoffshore
industry.
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OPTIMAL RESOURCE MANAGEMENT§ By andmaintaining amongthem,
itwaspossibletoimproveresourceextractionandutilization.Theforthe ofpetroleumresourcesin enhancedtherequirementsforoptimalrecovery.
§ Thecreationofthe andthequickdevelopmentofitsexpertiseenabledittoconduct and .In
NPDconducted inorderto
§ Stortinget’sinsistenceonbeingthefinalstageforapprovingfielddevelopmentplansstrengthenedthe inenforcingtheprinciplesof
to ensure .§ Bybalancingbetween ithasbeen
possibletoachieveoptimal .§ Aspectacularincreasein from to
wasthuspossibletoachieveon basiswiththeoilcompanies.
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