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    Norwegian gas supply lags behind forecast in June

Summary

The NPD attributed the lag to technical problems and maintenance work at some fields.

by: Joseph Murphy

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Norwegian gas supply lags behind forecast in June

Norwegian gas supply lagged behind the forecast level in June, amid technical problems and maintenance work at some fields, the Norwegian Petroleum Directorate (NPD) reported on July 21.

Production averaged 264.3mn m3/day during the month, which was 7.3% below forecast, down 5.8% month on month and down 5.5% year on year. Extraction of oil and other liquids came in at 6.3% below the forecast at 1.883mn barrels of oil equivalent/day, although this was still up 2% month on month and 1.4% year on year. 

Nearly all Norwegian gas is piped for sale in Europe, but the Snohvit field remains shut in while the Hammerfest liquefaction plant is repaired after last autumn's fire.

The NPD noted separately that eight new discoveries had been made in the first half of the year with a combined mid-range resource estimate of over 400mn boe. The finds are in mature areas, near other fields and infrastructure, in the North Sea, the Norwegian Sea and the Barents Sea.

A recovery in exploration drilling is expected this year, with the NPD forecasting around 40 wells, compared with 31 in 2020. Even last year's figure was relatively high considering the cuts that operators made to exploration spending in response to the pandemic. Norway's tax regime is highly supportive of exploration drilling, enabling operators to deduct most expenses from their tax base.