Norway approves oil and gas drilling proposals

19-Jan-2010

The government of Norway recently awarded 38 gas and oil production licenses, the petroleum ministry said this week.

According to the Norwegian Petroleum Directorate, the licenses are for sites in mature oil and gas fields. "The main challenge in mature areas," the directorate noted, "is that the expected sizes of discoveries are declining."

In a summary of 2009 oil production, the agency suggested that at current levels, 54 percent of the country's reserves will remain locked underground. Twenty-one new North Sea discoveries and seven new Norwegian Sea discoveries occurred last year, but most of these were small and are less viable commercially.

Large new discoveries are not expected in the future, and optimizing mature fields will become the goal of the country's oil ministry. By increasing recovery just 1 percent, the directorate said, the Norwegian economy gains between 100 billion and 150 billion kroner. Director General Bente Nyland called the strategy "good resource management [that] makes social economic sense."

The country's smaller discoveries are made more viable by extending production at existing fields, as well. Production from smaller fields can piggyback on current fields' infrastructure.

Breaking news brought to you by the Oxford Princeton Programme, specialists in energy courses. This and other related topics are part of the forthcoming course Options I - Fundamentals of Energy Options on 14 April, 2010 in London.