Oil and gas production

Total production rose in 2017 for the fourth straight year, and gas sales were at a record level. Never before has so much gas been sold from the Norwegian shelf as was the case in 2017. In the next few years, total production is expected to remain high.
Total production rose in 2017 for the fourth straight year, and gas sales were at a record level. Never before has so much gas been sold from the Norwegian shelf as was the case in 2017. In the next few years, total production is expected to remain high.

In the 50 years since Norwegian petroleum activities began, about 45 per cent of the estimated total recoverable resources on the continental shelf have been produced and sold. Thus, there are large remaining resources, and it is expected that the level of activity on the Norwegian shelf will continue to be high for the next 50 years as well.

What is produced on the Norwegian shelf?

The production (well stream) from different reservoirs contains oil, gas and water in various combinations. To get marketable products, the production from the reservoirs must be separated and treated. The production from different reservoirs varies from oil with low gas content to almost dry gas (methane with only small amounts of other gases).

Crude oil is a fluid that is a combination of different types of hydrocarbons. The composition varies from field to field. The quality of the oil depends on several factors, for example how much and which substances, such as wax and sulphur, it contains. The composition also determines how light or heavy (viscous) the oil is.

Rich gas, or crude natural gas, is a mixture of various gases. When necessary, the gas is separated from the oil before the rich gas is treated in a processing facility that separates the dry and wet gas components. Dry gas is often referred to as natural gas, and consists mainly of methane. Wet gas, or NGL (Natural Gas Liquids) as often referred to, consists of a mixture of heavier gases such as ethane, propane and butane. There is a gradual transition between the heaviest gas components which are called naphtha and condensate, and oil. Similar for them all is that they are liquid at room temperature, and are often mixed in, and sold as oil.

Not all gas that is produced is sold. Some of the gas is used to generate power on the fields, and small amounts are flared for safety purposes. On some fields, gas is reinjected into the reservoirs. Reinjection is often used to maintain reservoir pressure and displace the oil. This results in effective recovery of the oil, and the gas is stored for possible recovery in the future.

In 2017, Norway produced 236.4 million Sm³ of marketable oil equivalents (Sm³ o.e.). By way of comparison, total production was 230.6 million Sm³ o.e. in 2016 and 264.1 million Sm³ o.e. in the record year 2004.

Oil production was two per cent lower in 2017 than in the previous year. Most of the decline is the result of an unplanned maintenance shutdown on the Goliat field.

Gas production was high in 2017. Total sales of gas amounted to 124.2 billion Sm³ (122.0 billion Sm³ 40 megajoules of gas). Gas sales in 2017 ended 6.6 per cent higher than the estimates at the same time last year. This is due, in part, to consistently high demand for gas from Europe. In 2017, natural gas accounted for just above 50 per cent of total production by oil equivalents.

Historical production figures and production forecasts split by product type category are shown in the figure below.

Historical and expected production in Norway, 1970-2022

Updated: 11.01.2018

Source: Norwegian Petroleum Directorate

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Historical and expected production in Norway, 1970-2022

The production profile of a typical oil field shows a rapid increase to a maximum production rate, then a stable period of high production (the plateau phase), followed by a gradual decline in production. Without further investments, oil production will decline rapidly, and even with considerable investment to improve recovery, it can be difficult to maintain production from a field.

Without new fields or large-scale intervention to maintain production from existing fields, oil production from the Norwegian shelf would therefore continue to decline as it did from 2001 to 2013. Given the high level of development activity in recent years, production is expected to remain relatively stable for the next few years and will increase from the early 2020s. Production from new fields that come on stream will compensate for the decline in production from ageing fields. However, in the longer term, the level of production will depend on new discoveries being made, the development of discoveries, and the implementation of improved recovery projects on existing fields.

The figure below shows total historical production and production forecasts until 2030, distributed by maturity of the resources.

Production history and forecast distributed per resource category, 2010-2030

Updated: 11.01.2018

Source: Norwegian Petroleum Directorate (Gas is given in 40 MJ)

Print illustration Download data Production history and forecast distributed per resource category, 2010-2030 Download PDF Download as image (PNG)

Production history and forecast distributed per resource category, 2010-2030
Updated: 12.01.2018