Page 6 - EurOil Week 47

EurOil COMMENTARY EurOil

Norway opens next frontier

licensing round

The move comes amid an ongoing court case over the legalty of Arctic licensing

NORWAY NORWAY has invited firms to bid for 136 new ongoing case over the legality of licensing for
exploration blocks in frontier regions, mostly in offshore oil and gas exploration in the Arctic.
WHAT: the Arctic Barents Sea, in a bid to replenish its A lawsuit, backed by Greenpeace Norway and
Norway is offering 136 resources with large new discoveries. Nature and Youth, is attempting to use Norway’s
blocks mostly in the The move comes under a week after the coun- founding principles as justification for curbing
Barents Sea in its latest try’s Supreme Court finished hearing an case oil and gas activity.
frontier licensing round. brought by environmentalists contesting the “The Constitution says that everyone has a
previous award of Arctic acreage. right to healthy environment, and we will not
WHY: Under its 25th licensing round, authorities are ensure it if we continue to drill for more oil,” a
The round offers acreage offering 125 blocks across eight frontier zones in Greenpeace leader told Reuters on November 4.
in less explored regions the Barents Sea. A further 11 are up for grabs in Two lower courts earlier found the govern-
where risks and rewards one zone in the Norwegian Sea. Unlike Norway’s ment’s 2016 decision to grant the licences was
are potentially higher. annual awards in predefined area (APA) rounds, valid, prompting campaigners to lodge an appeal
which seek operators for blocks in mature areas at the Supreme Court. The highest court is antic-
WHAT NEXT: of the shelf, its numbered rounds occur at less ipated to give its verdict at the turn of the year.
Exploration drilling regular intervals in areas where infrastructure is Norwegian oil production is set to continue
has fallen to a 14-year scarcer and drilling risks greater. But wells can healthy growth over the coming years on the
low, but producers are also yield potentially large discoveries. back of contributions from the giant Johan
stepping up investment in “New discoveries are necessary to ensure Sverdrup oil project. But further exploration
development. continued activity, ripple effects, employment is needed to ensure that output is maintained
and government revenues throughout the coun- beyond Sverdrup reaching its plateau.
try,” Norwegian Petroleum Minister Tina Bru The Barents Sea is estimated to hold over 60%
said in a statement. of the total undiscovered resources off Norway,
The Norwegian Petroleum Directorate although over half of these volumes are found in
(NPD) added that “the announced acreage fea- places not opened up for exploration yet. While
tures a broad range of exciting plays that, so far, the region may yet yield considerable discover-
have not been extensively explored.” ies, development to date has largely failed to live
Companies have until February 23, 2021 up to the initial hype.
to file their bids, and awards should occur the It was more than 35 years when the first Bar-
following month. But authorities urged them ents Sea discovery, the now Equinor-operated
to submit their applications well before the Snohvit field, was made. Snohvit feeds into Nor-
deadline. way’s only LNG terminal. Since then, Snohvit
and the Eni-led Goliat field remain the only pro-
Legal challenges jects to have achieved production.
A factor weighing down on interest may be the There have been a number of drilling

P6 www. NEWSBASE .com Week 47 26•November•2020