Norway’s oil and gas industry

Key figures 2005

(based on 2004 figures)

Overview

• Norway’s interests

• Oil export and production

• Gas export and production

• The Government Petroleum Fund

• Petroleum in the Norwegian economy

• Internationalisation

Norway’s interests

• Norway co-operates on energy policy with our most important political and economic partners in the International Energy Agency (IEA)

• These are primarily importers of oil and gas

• Norway also has important shared interests with other oil-exporting countries both in and outside OPEC

Oil

• Norway is the world’s third largest oil exporter after Saudi Arabia and Russia

• The net export of Norwegian crude oil was 2.9 million barrels per day (Mbd) in 2004

• About 60% of Norwegian oil is exported to Western Europe

• About 15% is exported to North America (USA and Canada)

Oil exports (Mbd)

0

1

2

34

5

6

7

8

Saudi

Arabia

7,0

4

Russia

6,4

7

NORW

AY 2,9

3

Iran

2,47

Venez

uela

2,1

Niger

ia 2

,04

UAE 2,0

1

Kuwait

2,0

1

Mex

ico 1

,76

Iraq

1,51

Oil production (Mbd)

• With an oil production of 3.2 Mbd, Norway was the world’s seventh largest oil producer in 2004

0123456789

10

Russia

9,2

Saudi

Arabia

9,0

2

USA 7,6

2

Iran

3,96

Mex

ico 3

,83

China

3,49

NORWAY 3

,19

Canad

a 3,

08

Venez

uela

2,60

UAE 2,3

5

Gas

• Norway is the world’s third largest gas exporter after Russian and Canada

• Norway plays a particularly important role in European gas supply security

• Deliveries of gas from Snøhvit, the world’s most northerly and Europe’s first LNG installation, to the USA are planned to start in 2006

European gas imports

• Norwegian gas accounts for 19% of Europe’s gas consumption

Germany3 % NORWAY

19 %

UK4 %

Russia37 %

Nigeria3 %

Others3 %

Netherlands12 %

Algeria19 %

Importers of Norwegian gas in billion Sm3

Netherlands 4,316 %

Belgium 7,210 %

Italy 7,009 %

Austria 0,801 %

Spain 2,213 %

France 14,6520 %

Poland 0,51 %

Germany 26,4035 %

Czech Republic 2,623 %

UK 9,112 %

Others0 %

Gas imports to Germany

• Norway accounts for 29% of gas consumption in Germany, which is by far Europe’s largest importer of gas

Netherlands24 %

NORWAY29 %Denmark

3 %

Russia41 %

UK 3 %

Gas imports to France

• Norway accounts for 32% of gas consumption in France, Europe’s third largest gas importer

Belgium2 %

Netherlands21 %

Nigeria2 %

NORWAY32 %

UK2 %

Russia26 %

Oman0 %

Algeria15 %

Gas production 2003

• With a gas production of 78.5 bn Sm3, Norway was the world’s seventh largest gas producer in 2003

0

100

200

300

400

500

600

700

Russia

589

,1

USA 542

,9

Canad

a 18

2,8

UK 95,

9

Iran

85,5

Alger

ia 8

2

NORW

AY 78,

5

Indo

nesia

73,

3

Nethe

rland

s 68,

8

Saudi

Arabia

64

The Government Petroleum Fund

• Established by the Storting in 1990

• Funds first allocated in 1996

• Made up of the government’s revenues from the petroleum industry + the return on the fund’s capital

• Value at the end of 2004 was NOK 1 016 billion, an increase of NOK 171 billion from 2003

The growth of the petroleum fund

0

200 000 000

400 000 000

600 000 000

800 000 000

1 000 000 000

1 200 000 000

.199

6.199

7.199

8.199

9.200

0.200

1.200

2.200

3.200

4

NO

K

Petroleum in the Norwegian economy• The export value of sales of crude oil and

gas in 2004 is estimated at NOK 346 bn

• This is equivalent to 47% of total Norwegian exports

• The petroleum industry’s share of GDP in 2004: 21%

• More than 75 000 people are employed in the Norwegian petroleum sector

Production profile NCS

• Oil: constant up to 2007, then gradual decline

• Gas: increasing up to 2010, then flattens out

0

50

100

150

200

250

300

350

1971

1975

1979

1983

1987

1991

1995

1999

2003

2007

2011

2015

2019

2023

2027

mill

ion

sta

nd

ard

m3

oil

eq

uiv

ale

nts

GasNGLOil

Internationalisation

• “The Norwegian petroleum industry today has world class technology and expertise. The synergy between the dynamic Norwegian continental shelf and the growing global energy market [...] offers good opportunities for internationalisation for all companies.”

• Minister of Petroleum and Energy Thorhild Widvey

Internationalisation

• The petroleum-related overseas sales of Norwegian companies increased by an average of 10% per year from 1995 to 2003

0

5

10

15

20

25

30

35

40

.1995 .2003

mrd

NO

K