The total value of production for extraction and related services fell by 36.5 percent, from NOK 2,457 billion in 2022 to NOK 1,560 billion in 2023.
– The decline in revenues from the Norwegian Continental Shelf in 2023 comes as a natural consequence of lower oil and gas prices, says August Nicolai Meland at the Division for structural business statistics.
Despite the downturn in the In this article, extraction industries refers to the extraction of oil and gas, including pipeline transport., In this article, extraction services refers to services related to the extraction of crude oil and natural gas. have seen a substantial upswing, with a production value 33.3 percent higher than the year before. It rose from NOK 139 billion in 2022 to NOK 185 billion in 2023.
– This likely relates to investment decisions made for the Norwegian Continental Shelf in 2022 that are now being implemented, leading to significant activity within the extraction services industry. Nevertheless, because revenues in the extraction industries are so much larger than those in extraction services, we see an overall decline, says Meland.
The value of applied input goods and services, excluding capital consumption., or the input costs for both oil and gas extraction and extraction services on the Norwegian Continental Shelf, showed an overall upward trend from 2017 to 2021, followed by a marked 18.5 percent jump in 2022. In 2023, this growth continued with an increase of 9.0 percent, from NOK 171 billion in 2022 to NOK 187 billion in 2023.
The increase in overall expenses is primarily driven by higher expenses in extraction services, where intermediate consumption rose by 22.7 percent. Looking at the extraction industries alone, the figures show an increase from 2017 to 2022, but a decline of 11.3 percent in 2023.
Higher Costs Driven by Increased Employment and Wages
Employment on the Norwegian Continental Shelf has shown a slight upward trend in recent years, but 2023 saw an increase of 8.2 percent, from 58,700 employed in 2022 to 63,500 in 2023. At the same time, wage costs have risen significantly by 19.7 percent, from NOK 83 billion in 2022 to NOK 99 billion in 2023.
– After increased investments and high activity on the Norwegian Continental Shelf, we naturally see a rise in employment, and consequently an increase in wage costs, says Meland.
Increased Investments on the Norwegian Continental Shelf in 2023
Overall, investments remained stable from 2019 to 2022. However, following high activity in oil and gas extraction in 2022, we see a 20.1 percent increase in total investments for 2023, from NOK 182 billion in 2022 to NOK 219 billion in 2023.
– In 2022, the extraction industries were driven by high demand for gas from the Norwegian Continental Shelf. The increased investments can also be linked to the tax incentives granted to the oil industry in 2020, says Meland.
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