Norway’s oil investment to hit record high in 2024

Higher costs and ongoing field developments are set to boost oil and gas investment to a record level in offshore Norway, Western Europe’s biggest hydrocarbon producer, according to new data from Statistics Norway.

Total investment in oil and gas activity in 2024, including pipeline transportation, is expected to reach an all-time high of $24 billion (NOK 257 billion), Statistics Norway said on Thursday in its third-quarter survey of investment plans of oil companies.

The latest estimate is 4.1 percent higher than investment plans in the second quarter survey, which was $23.1 billion (247 billion kroner).

“The increase in estimates is mainly driven by higher cost estimates in production drilling in on-stream fields,” Statistics Norway said.

Oil company investment estimates for this year are also 21% higher than the corresponding estimate for 2023 in the Q3 2023 survey.

“The higher estimate for land development is related to the fact that significantly higher costs have now been reported for some development projects than operators had previously estimated,” according to Statistics Norway.

Norway’s offshore oil and gas investment will remain high in 2025. Next year, companies expect to invest a total of $22.45 billion (240 billion kroner), the latest survey showed. That estimate is 11 percent higher than companies’ forecasts in the previous survey in May, the statistics office said.

“The upward adjustment is largely driven by higher estimates in the stream and field development category areas,” Statistics Norway noted.

However, investment in exploration and onshore activities is moving in the opposite direction and helping to hold back the rise in estimates, he added.

While most exploration efforts are focused on areas close to existing infrastructure, Norway’s energy regulator said it “would like to see companies actively exploring in more frontier areas.”

By Tsvetana Paraskova for Oilprice.com

More top reads from Oilprice.com