January 14, 2020 / 1:57 PM / 6 months ago

UPDATE 3-Norway awards 69 oil and gas exploration blocks

* Equinor, ConocoPhillips, Shell and Total win blocks

* Greenpeace critical of new licences

* Awards crucial to Norwegian welfare system, says oil minister (Adds reaction, bullet points)

By Nerijus Adomaitis

SANDEFJORD, Norway, Jan 14 (Reuters) - The Norwegian government has awarded 28 oil and gas companies a total of 69 offshore blocks to explore for petroleum in mature areas of its continental shelf, the Norwegian Petroleum Directorate said on Tuesday.

Shell, ConocoPhillips, Total and Equinor won blocks, as did DNO, Aker BP , Lundin Petroleum and Eni’s Vaar Energi.

Private equity backed companies Chrysaor and Neptune Energy received stakes in eight and 13 blocks respectively.

Russia’s Lukoil, which holds stakes in two licences, and wholly owned Rosneft subsidiary RN Nordic, a previous licence holder, were not awarded any blocks. A ministry spokesman declined to comment on the reason for their omission.

Some green groups criticised the awards.

“With only 10 years left to halve our emissions, we need the government to stop handing out new oil licences and instead focus on a green transition and to decrease Norwegian dependency on oil,” Greenpeace campaigner Halvard Raavand told Reuters.

Norwegian oil and energy minister Sylvi Listhaug rejected any call to phase out the country’s oil industry.

“That would be a disaster for Norwegian society. There are ... 200,000 jobs associated with the industry, and the massive amount of value created enables us to maintain our incredible welfare model,” she told Reuters.

The annual licensing round for predefined areas covers blocks adjacent to previously explored or developed acreage, as opposed to licensing rounds in the country’s frontier areas.

Bids were submitted by 33 oil companies for a total of 90 offshore exploration blocks, including 48 in the Arctic Barents Sea.

RISING OUTPUT

The number of final awards depends on a range of factors, including Norway’s requirement that each licence must have several owners.

Of this year’s 69 licences, 33 were in the North Sea, 23 in the Norwegian Sea and 13 in the Arctic Barents Sea.

Norway’s oil and gas output is expected to rise sharply in the next several years as recent large discoveries come on stream, with authorities keen to extend the life of the oil and gas industry for decades to come.

Norway also conducts so-called numbered licensing rounds, which include frontier parts of the Norwegian continental shelf, where exploration is more risky but large finds could be made.

The government aims to announce the next numbered licensing round before Norway’s 2021 election. However, it must first agree an updated plan on areas to be made exempt because of environmental concerns, particularly in the Arctic.

The Norwegian Petroleum Directorate estimates that two thirds of Norway’s undiscovered oil and gas resources are in the Barents Sea, though exploration there has been disappointing recently. (Writing by Nerijus Adomaitis and Terje Solsvik; Editing by Gwladys Fouche, Jan Harvey and David Goodman)

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