Lower investment estimates for 2014
Total investments in oil and gas activity in 2014, including pipeline transportation, are NOK 218.6 billion, which is NOK 8.7 billion lower than estimated in the previous quarter. The estimate for 2015 has been adjusted upwards by NOK 3.3 billion to NOK 188.6 billion.
|Investment costs (mill. NOK)|
|Estimates made in May in the year before the investment year||143 180||194 285||208 223||182 420|
|Estimates made in August in the year before the investment year||171 958||204 045||215 095||185 256|
|Estimates made in November in the year before the investment year||184 591||207 815||223 259||188 570|
|Estimates made in February in the year of investments||186 044||198 678||223 724||.|
|Estimates made in May in the year of investments||186 654||211 303||231 700||.|
|Estimates made in August in the year of investments||184 942||212 768||227 267||.|
|Estimates made in Novenber in the year of investments||180 600||211 900||218 584||.|
|Accrued investment costs||173 482||211 883||.||.|
The estimate for 2014 is NOK 6.7 billion higher than the corresponding estimate for 2013 given in the 4th quarter of 2013. The estimate for 2015 is NOK 34.7 billion lower than the corresponding estimate for 2014 given in the 4th quarter of 2013. This indicates that the investments will increase moderately and reach a peak in 2014 and fall again in 2015.
Steep decrease in field investments in 2015
The decrease in 2015 is mainly due to significantly lower estimates for field development and fields on stream. Investments for field development and fields on stream in 2015 are estimated at NOK 136.2 billion. This is NOK 45.5 billion lower than the corresponding estimate for 2014.
After several years with high investment activity within fields on stream, this investment category reached its peak in 2013 and will decrease in the present year. The estimates in this survey indicate a further decrease in 2015. The infrastructure on many old and large fields has been upgraded in the last ten years. The need for this kind of investment activity is now decreasing. In addition, there has been a high level of activity for improved oil recovery in the same period. Investment in this type of activity is also now decreasing, mainly due to a greater focus on cost reduction in the oil companies.
The investments in field development are expected to reach a peak in 2014 and the estimates given in this survey indicate a significant decrease in this category next year. Some development fields have come on stream in 2014 and others will come on stream early next year. These fields will have significantly lower investment costs next year. In addition, no new development projects have been included in the survey. A Plan for Development and Operation (PDO) on Zidane and Bream had been planned for delivery this autumn, but these projects have now been postponed. The Maria project, which was previously postponed, is now planning to deliver a PDO in the 2nd quarter of 2015. A PDO is expected to be delivered on Johan Sverdrup in February 2015. According to preliminary plans, the expected investment costs on this project are estimated at NOK 2.5 and NOK 7.5 billion in 2014 and 2015 respectively. The fall in investments indicated in the survey might be softened when the Johan Sverdrup is included in the survey.
Lower estimate for 2014
Total investment for 2014 is now estimated at NOK 218.6 billion. The estimate is NOK 8.7 billion lower than the estimate given in the previous quarter.
The estimate is NOK 6.7 billion higher than the corresponding estimate for 2013 given in the 4th quarter of 2013.
The increase relative to 2013 is mainly due to significantly higher estimates of field development. The estimates indicate a decrease in investment within fields on stream.
The investments within Removal and Shutdown in 2014 are estimated at NOK 8.4 billion, which is NOK 5.6 billion higher than the final investment for this cost category in 2013.
Lower investment activity in 3rd quarter
While the accrued investment costs came to NOK 55.7 billion in the 2nd quarter, the accrued costs decreased slightly to NOK 5.4 billion in the 3rd quarter. The accrued investments in the first three quarters in 2014 summed up to NOK 162.7 billion. This corresponds to a quarterly average of NOK 54.2 billion. Realisation of the current estimate for 2014 assumes investments of NOK 55.8 billion in the 4th quarter.
The information in the survey was collected from the operators on the Norwegian Shelf in mid-November.