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UPDATE 1-Norway sees dip in oil firms applying for drilling permits

Wed, 09th Sep 2015 11:18

(Adds energy minister's quote, background)

OSLO, Sept 9 (Reuters) - A total of 43 oil firms have askedfor drilling permits in Norway's annual licensing round inso-called mature areas of its continental shelf, down from 47last year, the country's Oil and Energy Ministry said onWednesday.

Statoil, BP and Royal Dutch Shell were among the applicants, it added.

Norway, western Europe's biggest energy producer, regularlyoffers blocks that were either handed back or not taken inprevious rounds as technological advances and nearby discoveriesimprove exploration prospects over time.

Plunging crude prices have led to a sharp decline ininvestments by oil firms on Norway's continental shelf thisyear, leading to higher unemployment and concerns that thecountry's most important industry will continue to contract.

"Giving extensive and predictable access to attractiveexploration acreage is among the most important things thegovernment can do to sustain a high, long-term activity level inthe industry," Energy Minister Tord Lien said in a statement.

Unlike many other oil and gas producers, Norway hands outlicences for free and subsidizes both exploration anddevelopment costs before imposing a 78 percent tax onproduction.

Among the new blocks included in the 2015 mature round areacreage near Statoil's Aasta Hansteen gas field, LundinPetroleum's Alta and Gohta finds and blocks near thesmaller Pil and Bue discoveries, the ministry has said.

Mature areas licensing rounds have led to a plethora ofdiscoveries in recent years and even part of the giant JohanSverdrup field, with up to 3 billion barrels of oil equivalentswas found through such an award.

The government is expected to decide on the allocation ofresources in early 2016.

Norway is also conducting a separate licensing round forfrontier areas with a focus on Arctic areas and expectsapplications until Dec. 2. (Reporting by Terje Solsvik, editing by Alister Doyle and SusanThomas)

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