Norway says its offshore oil production will fall 10 percent more through 2013 than predicted a year ago, but will be partly offset by an increase in natural gas exports.
A Norwegian Petroleum Directorate report said Tuesday that oil production is expected to average 1.91 million barrels per day this year, and dwindle to 1.62 million barrels per day in 2013, a 10 percent larger decline than projected last year.
Production was about 2.2 million barrels per day at the end of 2008, after falling from a peak average of 3.1 million barrels per day in 2000.
The government has been urging oil companies to step up efforts to find more oil near existing North Sea fields, develop technology to get more crude out of current reservoirs, and move exploration into Arctic waters in a bid to offset the oil production decline.
"Much of our oil and gas production comes from discoveries made in the first 20 years, during the period between 1969 and 1989. Resource growth from discoveries made in the last decade is low," the directorate said.
While oil production is expected to decline in coming years, natural gas flows are seen increasing 25 percent for the five-year period, mostly from fields that are already in operation.
The directorate said Norway has produced about half of its proven oil and gas reserves, and that recoverable reserves of 5 billion cubic meters (roughly 31.5 billion barrels) of oil equivalents remain. Oil equivalents measure the energy content rather than the volume of oil and natural gas.
Norway has been a major exporter of oil and natural gas to Europe for over four decades. Its offshore fields have provided the Nordic welfare state more revenues than it can use, allowing Oslo to invest over 2 trillion kroner ($333 billion) in surplus government revenues in foreign stocks and bonds for future use.
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