Equinor ASA said it is boosting the local economy, as its activities in Norway were measured as costing over $12.72 billion (NOK 134 billion) last year, of which 94 percent was transacted with Norwegian suppliers.
According to a report from Kunnskapsparken Bodø (KPB), the amount was derived from deliveries for exploration, development projects and operation of Equinor-operated fields and onshore facilities in the country.
KPB analyzed actual purchases of goods and services for Equinor-operated fields and onshore facilities, development projects and exploration activity from Hammerfest LNG in the north to the Sleipner field in the south, Equinor said in a news release. The company said it is the largest purchaser of goods and services from the Norwegian supplier industry.
“We have operations along the entire coast of Norway that have major ripple effects,” Kjetil Hove, Equinor’s executive vice president for Exploration and Production Norway, said. “The Norwegian supplier industry has developed its expertise and competitiveness together with us for over 50 years. A total of 81,500 man-years worked in connection with assignments from Equinor last year. The level of activity and value creation is high. We have plans to further develop our operations in Norway so that this will continue in the future”.
“This year’s report shows that deliveries to this industry come from the majority of Norwegian municipalities and are spread across the country,” Per Steinar Stamnes of Industri Energi said. “Our industry makes it possible for employees to live in places where they would not otherwise have the same job opportunities. The fact that there is activity in so many municipalities illustrates how the oil and gas industry benefits the whole country. Europe is completely dependent on energy from the Norwegian continental shelf, so it is important to maintain production”. Stamnes spoke on behalf of the five unions in Equinor: Industri Energi, SAFE, Lederne, NITO and Tekna.
Equinor plans to maintain its oil and gas production of around 1.2 million barrels per day from the Norwegian continental shelf up to 2035. At the same time, it aims for emissions to be halved by 2030 in line with the Paris Agreement.
Development projects in the implementation phase are included in this year’s ripple effect report from KPB for the first time, according to the release. In 2023, Norwegian deliveries of goods and services amounted to $2.36 billion (NOK 24.9 billion). This represents a Norwegian share of 89.5 percent, “which is somewhat higher than normal,” Equinor said.
“Equinor has a large project portfolio, and it is important to us that our activity creates ripple effects in Norway. Johan Castberg, which we plan to put on stream at the end of the year, accounts for a large share of this. We also see significant ripple effects in Norway from the electrification portfolio and projects tied back to existing infrastructure,” Trond Bokn, Equinor’s senior vice president for project development, said.
Direct equipment and service deliveries from the Norwegian supplier industry to the operation of Equinor-operated petroleum installations and onshore facilities, development projects, and exploration activity amounted to $12.05 billion (NOK 127 billion), according to the study.
Equinor said it purchased goods and services from the Norwegian supplier industry for the operation of fields on the Norwegian continental shelf for $7.88 billiion (NOK 83 billion). Deliveries related to exploration activities totaled $0.73 billion (NOK 7.7 billion), while Norwegian deliveries to onshore facilities operated by Equinor amounted to $1.01 billion (NOK 10.6 billion).
The report is limited to spin-off effects from exploration, development projects, operations, and modifications of Equinor-operated fields and onshore facilities in Norway, Equinor noted, adding that the “values realized for the owners and society when the products from the fields are sold as well as the payment of tax are not included”.
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