Wednesday, March 30, 2016

Norway Has More Problems Than Just $40 Oil -- Bloomberg -- March 30, 2016; Iran Won't Be "Moving" As Fast As Earlier Expected

Wow: Over the past 25 years, exploration wells off Norway averaged 27 million bbls -- 27 million bbls/exploration well -- until this past year. This past year, on average, each exploratory well off Norway averaged less than 5 million bbls of oil and gas. 
Bloomberg is reporting Norway has more problems than $40 oil:
The collapse of crude prices isn’t the only problem facing energy companies in Norway: Explorers in western Europe’s biggest oil-producing nation also have had their leanest drilling spell in almost a decade.

Companies searching off Norway found less than 5 million barrels of oil and gas for every exploration well drilled last year, the lowest ratio since 2006. That compares with a 27 million-barrel average over the past 25 years.

The dismal results, due in part to the depletion of the North Sea, are bad news for a country whose oil production has shrunk by half since 2000. The slump in prices has already dried up income from crude extraction, which feeds the world’s biggest sovereign wealth fund and has made Norwegians some of the richest people on the planet. In January the government made its first withdrawal from the fund since it was set up in the 1990s as the market rout eroded growth.

The dwindling drilling success has left the country’s top explorers -- Statoil ASA and Lundin Petroleum AB -- impatient to tap an entirely new region of the nation’s Arctic, bordering Russian waters. Norway plans to award licenses in an area known as the Barents Sea Southeast before summer and drilling could begin as soon as 2017.
Much more at the link.

Reuters/Rigzone is reporting:
Iran is expected to add half a million barrels of oil supply a day within a year from its existing oilfields after the lifting of sanctions against Tehran in January, but developing new fields would take time, the head of the International Energy Agency said on Wednesday.

Iran, previously OPEC's second-largest exporter, would need to prove that the investment conditions were profitable to the international investors and also that there was predictability in the markets.

[IEA's] estimate of Iran's supply increase from existing oilfields was in line with previous market estimates. And increases in Iranian gas supplies would come after oil.
"It was misleading to believe that there would be a huge amount of new Iranian crude and natural gas production entering market in the short term," [IEA head] said.

"It would take some time in terms of developing new oil fields, finding transmission routes and having the necessary market conditions."
Iranian oil officials were hoping for a quick rebound in oil sales to European clients, which accounted for over a third of Iran's exports, or 800,000 barrels per day, before the European Union imposed sanctions in 2012 over Tehran's nuclear programme.

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