Page 16 - EurOil Week 23

EurOil POLICY EurOil

Norwegian firms unveil new

investments after tax relief

NORWAY NORWEGIAN oil firms Aker BP and Equinor generate significant tax revenues for the Nor-
both announced new investments on June 9 after wegian government.
Norway has allowed Norway’s government provided temporarily tax “The petroleum industry is going through a
companies to shield relief for the industry. very challenging time, and we are very pleased
some of their earnings The minority government and opposition to see the rapid and strong response from Nor-
from taxes. parties agreed this week to allow oil producers wegian lawmakers,” CEO Karl Johnny Hersvik
to shield some of their earnings from taxes, in said. “The proposed changes are appropriate
order to encourage them to invest more and keep and necessary and will strengthen our capac-
more jobs. ity to invest while at the same time [contrib-
The following day, Aker BP reported it had uting] to improved profitability of new field
awarded a NOK1bn ($106mn) contract to oil developments.”
service firm Kvaerner to build an unmanned oil Meanwhile, Equinor said it would push ahead
platform for redeveloping the Hod oilfield. Aker with a NOK1.5bn investment to connect its off-
BP is part-owned by Norwegian billionaire Kjell shore installations at the Gina Krog and Sleipner
Inge Roekke, who also controls Kvaerner. fields to the onshore grid. This means they will be
The operator had said back in late April it powered mainly by onshore hydroelectric plants
would put the Hod redevelopment and other (HPPs), rather than onsite gas generators, reduc-
unsanctioned projects on hold in response to ing their carbon emissions.
the market crisis. Equinor on June 9 handed Norwegian ser-
“The Hod development in the Valhall area is vices firm Aibel a NOK160mn contract to elec-
the first project to be launched as a direct result trify Gina Krog and a NOK400mn contract to
of the tax changes,” Aker BP said in a statement. electrify Sleipner. The projects will provide hun-
“Aker BP’s board has today approved the project dreds of jobs, it said.
and authorised a fast-track investment decision Echoing Aker BP, Equinor said the tax changes
to be concluded as soon as possible.” would spur investment and help to maintain off-
The company added that Hod would shore activity in “a challenging period.” ™

PROJECTS & COMPANIES

Repsol exits Bulgarian oil find

BULGARIA THE Bulgarian government announced on yielded much in the way of results.
June 10 it had granted Spain’s Repsol per- Total, Repsol and OMV won rights to Han
Repsol, like other IOCs, mission to withdraw from an offshore oil Asparuh back in 2012. The block covers 14,220
is cutting spending and discovery. square km in water depths of up to 2,200 metres.
making divestments. Repsol, alongside partners France’s Total and The government is currently seeking investors
Austria’s OMV, struck oil after drilling at the 1-21 to develop a block adjacent to Han Asparuh,
Han Asparuh block in the Black Sea in 2016. The known as Terval.
group has sunk two more wells since then, but Royal Dutch Shell, Repsol and Australia’s
has not disclosed resource estimates for the dis- Woodside Petroleum have also been exploring
covery, making it impossible to assess its com- the nearby Silistar block for several years. But
mercial potential. Woodside revealed in a report in July last year
Announcing Repsol’s exit, Bulgaria’s govern- that a wildcat well drilled there had come up dry.
ment said Total’s share in the project would rise Ireland’s Petroceltic does produce small
to 57.1%, while OMV’s would increase to 42.9%. amounts of gas at a cluster of fields at Bulgaria’s
Their permit to develop the area has also been offshore Galata block, but the company is strug-
extended by two years until May 15, 2022. The gling to arrest decline.
remaining partners intend to spend €3.3mn Like many international oil companies
($3.9mm) on further geological and geophysical (IOCs), Repsol has announced deep cuts to
research and seismic surveys at Han Asparuh, spending in response to the oil price crash,
the government said. It did not say whether any triggered by the coronavirus (COVID-19) pan-
more wells were planned. demic. It has also pledged to prune its interna-
Bulgaria has sought for years to establish off- tional business of non-core assets in order to
shore oil and gas production, in order to over- raise cash. The company swung to a €487mn net
come its dependence on imports that mainly loss in the first quarter, after booking €790mn in
come from Russia. But so far this push has not impairment charges. ™

P16 www. NEWSBASE .com Week 23 11•June•2020