Norway oil executives warn on long-term supply as polls loom

Bloomberg

Elections are approaching in Norway, accompanied by the familiar sound of oil executives and politicians arguing over the environmentally sensitive Lofoten islands in the Arctic.
Oil prices may have plunged in a global economy awash with oversupply, but producers in Norway say they’re thinking much longer term. Statoil ASA, which has been lobbying for years to open the waters off Lofoten and Vesteraalen in Norway’s north, argues that failure to include the area in exploration plans will create supply issues in the future.
With general elections looming, Statoil this week warned that oil and gas production and industrial activity would drop a decade from now if the current ban on drilling is maintained.
“My responsibility is to point out that time is running,” Chief Executive Officer Eldar Saetre said. Even new blocks soon to be awarded in the Barents Sea aren’t “enough to compensate for the big fields that decline.”
Explorers keen to enter an area that could hold as much as 2.3 billion barrels of oil equivalent have been stopped by political bargains over the past five years. Norway’s two biggest parties, Labor and the Conservatives, support starting an impact study of oil exploration and production outside the Lofoten islands but have agreed to maintain the drilling ban in exchange for the support of smaller parties needed to govern.
Even though oil has fallen more than 60 percent since 2014, Norway will still need to renew resources as fields are depleted, Saetre said during a conference on Tuesday.

New discoveries take 10 to 15 years to develop, and the unopened areas outside Lofoten are “attractive” he said.