Norway is looking to expand its oil and gas production with a new licensing round in frontier areas, with parliament directing the country’s minority government to facilitate the event.
Reuters reports that the proposal to restart licensing rounds for oil and gas came—unsurprisingly—from the Conservatives but it gained majority support thanks to Norway’s centrist party, which left the governing coalition earlier this year, putting it on shakier grounds as a minority government.
Norway has become the largest supplier of pipeline natural gas to Europe and boasts the biggest sovereign wealth fund in the world thanks to its oil and gas; however, it also has the highest per-capita ownership of electric cars and a most ambitious transition state.
Even so, Norway has acknowledged it cannot give up oil and gas anytime soon. Earlier this year, the government awarded stakes in as many as 53 oil and gas licenses in its latest annual licensing round despite increasingly loud opposition from various environmentalist groups.
“If we are to uphold a stable production in the years to come, we must explore more and invest more,” Energy Minister Terje Aslund said in January when the new licenses were awarded. Norway has been fighting natural depletion and fewer new discoveries—alongside climate groups.
Thanks to the government support that the oil and gas industry has received, companies active in the field said at the end of 2024 they planned to spend a record amount of money this year, beating a record set in 2024.
At close to $24.7 billion, the planned 2025 total investment amount exceeded expectations, the local energy industry association said in December, as quoted by Reuters. Some of the increase was a result of rising inflation but the rest was motivated by more drilling at both existing fields and new deposits.
By Irina Slav for Oilprice.com
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