Norway is expected to reduce exploration activity this year but should be able to maintain production “for the time being” despite the COVID-19 pandemic and a fall in oil prices, the Norwegian Petroleum Directorate (NPD) said on April 8.
Western Europe’s largest producer meets about 2% of global oil demand and about 25% of Europe’s natural gas demand, while petroleum accounts for about 40% of its exports.
Companies operating on the Norwegian Continental Shelf, including Equinor, Aker BP and Lundin Energy, have already announced capital spending and exploration cuts to save cash.
“As of today, it appears that around 10 exploration wells will be postponed, meaning that there will be about 40 exploration wells in 2020, however, we can’t rule out further changes in this area in the future,” the NPD said in a statement.
Companies are postponing drilling of wells at operating fields and there appear to be delays and cost increases for many projects under development, the regulator said.
“Reduced progress in projects linked to extraction of time-critical resources and postponing activities on producing fields and development projects could affect future production and overall resource extraction,” the NPD said.
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