NOK 300 billion in net revenue from the petroleum industry

In the National Budget 2015, the State’s net cash flow from the petroleum industry is forecast to total close to NOK 300 billion in 2014 (fixed 2015 prices). Direct and indirect taxes account for around 60 per cent of the total. The State’s Direct Financial Interest (SDØE) contributes approximately 35 per cent, while the remainder comprises dividends from Statoil.

This forecast represents a drop of about 9 per cent in the State’s net cash flow from the petroleum industry compared to the estimate in the Revised National Budget 2014. The fall is primarily due to lower tax receipts and lower achieved gas prices than previously anticipated. In the forecast, oil and gas prices have been estimated at NOK 670 per barrel and NOK 2.15 per standard cubic metre, respectively (fixed 2015 prices). Current price levels indicate that these estimates are somewhat high.

- I am very pleased to see the petroleum industry continuing to produce substantial value for Norway year after year. The industry is Norway’s most important in terms of value creation, state revenue and export value. We can all be proud of how we manage our natural resources,” says Minister of Petroleum and Energy Tord Lien.

Petroleum industry investment (including in exploration) is expected to total approximately NOK 218 billion in 2014 (fixed 2015 prices). In 2015, investment is anticipated to fall by about 8 per cent, but will remain at a high level in historical terms. The investment level is primarily driven by the scale of the projects under development at any given time.

Total production of oil, LNG (liquefied natural gas), condensate and gas on the Norwegian continental shelf is expected to total around 214 million standard cubic metres of oil equivalents in 2014, with gas accounting for about half of total production. Production levels are expected to remain largely unchanged in 2015.

The total petroleum resource estimate has not been amended since the Revised National Budget 2014. The total recoverable resources on the Norwegian continental shelf are estimated at 14.2 billion standard cubic metres of oil equivalents, equivalent to 89 billion barrels. Some 44 per cent of the total recoverable resources had been produced by the beginning of 2014.

- The resource base on the continental shelf provides a foundation for value creation for many decades to come. To exploit this resource base, we have to work together to overcome the challenges we face, ensuring that the industry is efficient and competitive. We must also continue to concentrate on existing fields, develop new discoveries close to existing infrastructure and explore immature areas,” says Minister of Petroleum and Energy Tord Lien.