Extraction and related services, 1998, preliminary figures

The oil industries comprise operators and licensees operations relating to the extraction and pipeline transport of crude oil and natural gas. Services and contract oil drilling come in addition. While the gross production value of crude oil and natural gas extraction showed a decline of NOK 51.5 billion or 27.1 per cent from 1997 to last year, the gross production value of oil and gas-related services, including pipeline transport, increased NOK 3.4 billion.

The sales value of crude oil and gas production in 1998 is estimated at NOK 129.1 billion, a 27.7 per cent decline from 1997. The production of crude oil, including Natural Gas Liquids (NGL) and condensate, fell by 8.0 million tonnes of oil equivalents (mtoe), a 5.2 per cent decline from 1997. The production of natural gas increased from 46.8 million standard cubic metres of oil equivalents (Sm3 o.e.) in 1997 to 47.7 million Sm3 o.e. in 1998. This is an increase of 0.9 million Sm3 o.e., or 1.9 per cent. The sales price of crude oil, NGL and condensate was reduced by an average of 29.8, 24.8 and 29.6 per cent respectively. The price of natural gas showed only a small decline in 1998.

Added value

Added value in the oil industries as a whole was NOK 133.4 billion in 1998. This was a decline of NOK 50.4 billion, or 27.4 per cent from 1997 to 1998 and was mainly caused by the lower production value in the extraction of oil and natural gas. The process value is an expression of added value, which is mainly determined by three factors: production, prices and intermediate consumption. Added value in the extraction of crude oil and natural gas fell NOK 52.3 billion from 1997 to last year. Beyond lower oil and gas prices and reduced petroleum production, the main contributor to the decline is that intermediate consumption increased by 3.2 per cent.

In 1998 the process value of pipeline transport came to NOK 14.0 billion, an increase of 7.4 per cent from 1997. Higher tariff revenues were a major contributor to the higher added value in pipeline transport. The quantity of oil and gas transported through the pipelines was basically unchanged in 1998, while intermediate consumption increased by 5.7 per cent from 1997.

In 1998 intermediate consumption in the producing oil and gas fields amounted to NOK 17.6 billion, an increase of NOK 1.0 billion or 5.9 per cent from 1997. Maintenance costs in particular contributed to the increase in intermediate consumption, increasing NOK 0.8 billion. The increase in intermediate consumption for fields on stream happened even though overall petroleum production fell 3.5 per cent from 1997 to 1998. Intermediate consumption per extracted barrel consequently rose from a record low of NOK 10.95 to NOK 12.02 in 1998.

Higher employment in oil industry

The oil industries employed 24,221 persons in 1998. This is an increase of 479 employees or 2.0 per cent form 1997. The increase is wholly attributed to the expansion of service companies in 1998. Wages costs including social benefits increased by 6.8 per cent in 1998. In 1998 wage costs per employee amounted to NOK 624,000, an increase of 4.7 per cent compared with similar figures in 1997.

Total accrued production and CO2 tax in the extraction of crude oil and natural gas declined 28.4 per cent. The production tax, which makes up the largest portion of the tax, went down NOK 3.1 billion.

The statistics are published annually.