The estimate for 2022 is 1.5 per cent higher than the estimate given in the previous quarter. Furthermore, the 2022 estimate is 3.8 per cent lower than the corresponding estimate for 2021, given in the 4th quarter of 2021
The estimate for 2023 is 3.0 per cent lower than the corresponding estimate for 2022 given in the 4th quarter of 2021. The previous survey suggested a decline of 4.7 per cent. Weaker decline is indicated now because the estimate for 2022 in corresponding measurements last year increased less than the estimate for 2023 now. It is expected that plans for development and operation (PUD) will be submitted to the authorities for many new development projects in December this year. The figures for these projects will only be available when the PUD has been delivered. One of the largest of these projects, Wisting, was recently decided to be postponed until 2026. There is nevertheless reason to believe that the estimate for 2023 will increase significantly in the next survey in February. In that survey, the first estimate for 2024 is also published. With all these developments included already then, there is reason to expect a relatively high initial estimate for 2024.
Quarterly investment statistics for oil and gas extraction and pipeline transport are included in the survey Investments in oil and gas, manufacturing, mining and electricity supply. For more details about total investments, please see the following article.
Increase in the estimates for field development and fields on stream in 2023
The investments in field development for 2023 are estimated at NOK 50.2 billion. This is 12 per cent higher than the estimate given in the previous survey. The higher estimate is mainly due to significant higher reported cost estimates on some development projects. These increased costs will probably not contribute much to expanded production capacity more than initially planned. It is within the commodity subcategory that the entire rise in the estimates comes, here the estimate increases by as much as 74 per cent. The other two categories of services and production drilling actually have lower estimates now than in the previous survey. No plan for development and operation (PDO) has been submitted for any development project since the last survey in August. As mentioned above, it is expected that PDO will be delivered on many projects in December this year. The accumulation of PDOs late in 2022 is related to the tax measures package. Favorable taxation is given on all development costs up to and including the year the fields are on stream, on those projects for which PDO is delivered before the end of 2022.
The investments in fields on stream for 2023 are now estimated at NOK 69.2 billion. This also represents an increase of 12 per cent compared to the estimate given in the previous quarter. The increase in estimates comes within all three subcategories of commodities, services and production drilling.
Although the estimate for investments in oil and gas extraction and pipeline transport has increased significantly, the stated accumulated amount for 2023 is still 3.0 per cent lower than the corresponding estimate for 2022. As Figure 3 below shows, it is the estimates for the investment areas exploration and concept studies, field development as well as shutdown and removal which contribute to the investment decline indicated for 2023. The investment areas of fields on stream, onshore activity and pipeline transport are going in the opposite direction with higher figures for 2023 than in the corresponding estimates for 2022.
The 2023 estimates for exploration and concept studies are as much as 19 percent lower than the corresponding estimate for 2022, given in the 4th quarter of 2021. It is the category of concept studies in particular that contributes to the fall, with a drop of as much as 96 percent. This type of cost covers activity related to development planning of oil and gas discoveries. The sharp drop indicated for next year is related to the fact that activity in concept studies is at a record high level in the present year, since there are so many new development projects that need to be planned for. With these developments soon to start, there will be very few new developments to plan in the short term, therefore there will be very little activity in concept studies next year.
Higher investment estimates result in a lower indicated fall in 2022
The investments in oil and gas extraction and pipeline transport for 2022 are now estimated at NOK 175.3 billion. This is 1.5 per cent higher than the corresponding figure for 2021, given in the same period last year. The growth is particularly related to higher estimates within the category fields on stream and field development.
With the upward adjustment in this measurement, the estimate for 2022 is 3.8 percent lower than the corresponding estimate for 2021, given in the 4th quarter of 2021. The indicated decrease for 2022 was in the previous measurement of 4.8 percent. It is field development and fields on stream in particular that drives the decline indicated for 2022, but shutdown and removal also contribute negatively. The remaining main categories contribute little to the indicated change in the level of investment from 2021 to 2022.
The decline in field development must be seen in the context of several development projects being put into operation and others in a final development phase. The new developments that have come about do not fully replace the decline from these. As mentioned above in the discussion of 2023, it is expected that plans for development and operation (PDO) will be delivered for a number of developments late this year. Each of these will have relatively low investments made this year, both because developments tend to have low investments in the first year and because the vast majority of developments are expected to start very late this year. But since the planned projects are so numerous, they will still be able to generate significant investments in the 4th quarter of this year, which, viewed in isolation, can raise the development investments this year beyond what is included in the present estimate for 2022.
Marginal seasonally adjusted fall in the 3rd quarter of 2022
The accrued investment costs in the 3rd quarter of 2022 amounted to NOK 43.7 billion. This is 0.4 per cent lower than the accrued investment costs in the 2nd quarter. The seasonally adjusted figures show an investment decrease of 0.2 per cent from the 2nd to the 3rd quarter. The investments carried out in the 3rd quarter ended up 3.9 per cent lower than in the estimate given for the 3rd quarter in the previous survey.
The accrued investments in the first three quarters in 2022 summed up to NOK 128 billion. Realization of the current estimate for 2022 assumes investments of NOK 47.3 billion in the 4th quarter, which implies investment growth of 8.3 per cent from the 3rd to the 4th quarter. Historical figures show that there are normally highest investments in the 4th quarter. Over the past 5 years, average investment growth from the 3rd to the 4th quarter has been 8.6 per cent. In that perspective, it is possible for the oil companies to realize their investment plans for the 4th quarter.
On the other hand, the annual estimate given in the 4th quarter of the investment year has been on average 2.6 percent higher than the final investments over the past 21 years, and in only one of these years has the annual estimate given in the 4th quarter been lower than the final investments.
The special thing for the current year is all the developments that are expected to come towards the end of the year. The investments made this year on these projects will come in addition to what is included in the current measurement. This gives reason to believe that final investments this year will be closer to the annual estimate given in the 4th quarter than in a normal year. It is also possible that the final investments will be on par with or higher than the estimate given in this measurement.