Why Norway adds to supply-side worries

By Daniel J. Graeber  |  Nov. 18, 2016 at 6:11 AM
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STAVANGER, Norway, Nov. 18 (UPI) -- Total production of oil and natural gas last month from Norwegian reservoirs was about 30 percent higher than September, the government said Friday.

Norway is among the top suppliers of fossils fuels to the European economy. The National Petroleum Directorate said preliminary production estimates for oil, natural gas liquids and an ultra-light product called condensate was about 30 percent higher than the previous month.

For oil, the 1.71 million barrels of oil produced per day on average was 4 percent above October 2015 and 10 percent more than the government expected. Final production figures for oil from September show an average 1.39 barrels of oil per day.

The figures add to a lingering market scenario of oversupply. Members of the Organization of Petroleum Exporting Countries are discussing a production ceiling of around 32.5 million bpd in an effort to pull the market back into balance. That level would amount to a cut in OPEC production and the arrangement potentially hinges on non-member states to be effective.

The International Energy Agency last week said there was little support for a balanced market coming from the demand side of a lackluster global economy. For those seeking higher crude oil prices, the IEA said its analysis of OPEC production and other components offered little comfort.

In October, the NPD said energy company Statoil uncovered oil near an existing field in the southern waters of the Norwegian Sea while drilling a wildcat well, a well tapping into an area not previously known to contain hydrocarbons.

In early November, the Norwegian energy major, which is co-owned by the government, submitted a plan for development to Petroleum Minister Tord Lien for the Trestakk discovery. Confirmed in 1986, the discovery holds about 76 million barrels of recoverable oil equivalent, and most of that exists as oil.

A regional subsidiary of French supermajor Total discovered gas while drilling a wildcat well in the northeast part of the Martin Linge field.

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