Seminar for National Oil Companies

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Dear all,

Thank you for the invitation and for the opportunity to be here today with so many representatives of the global energy sector.

It is indeed a pleasure to speak to a group of people that represents such a wide range of countries, cultures, and experiences.

Who all share a common purpose: to secure energy for the world’s growing needs.

Needs from a growing population with aspirations for a better life.

We meet at a time of great change and great uncertainty. Globally and regionally.

War, geopolitical tensions, inflation, and the ongoing need for a just and sustainable energy transition. And all of this at the same time.

Out of this situation it becomes increasingly clear that we must have a balanced policy between energy transition, energy affordability and energy security.

A balance often called the energy trilemma.

But this balance must consider economic viability when we design energy policies.

As energy producers, our responsibility has never been greater.

Norway is proud to be an important, secure and trusted energy partner for Europe. A sector which also is a source of revenues and welfare.

About 30 percent of the gas consumed in the European Union and the UK now comes from Norway.

This success is thanks to what we call the Norwegian model for managing oil and gas. At its heart is the Petroleum Act.

It says that oil and gas must be managed for the long-term benefit of all of Norway – creating income, jobs, and a better environment, while also supporting business and local communities.

The model is built on close cooperation between the government, companies, and workers. This ensures that private companies do the work, while the state earns income and makes sure that safety and the environment are protected.

The model has been updated over time, but its core ideas remain the same.

Let me share some more features of the Norwegian way of managing petroleum resources.

Over the years this Model has been modernized to be adapted to the maturation of the Norwegian Continental Shelf and the development of the Sovereign Wealth Fund. But always maintaining the idea behind the main principles of the Model.

First, we believe in diversity on the shelf.

Competition and cooperation create better results.

We have now a system where several types of commercial players are active:

• A strong Norwegian oil and gas company, Equinor, that competes on commercial terms.
• International oil companies that bring global experience and innovation.
• Medium-sized local companies with alternative competences and supplementary business profiles to secure competition
• Smaller, innovative companies that contributes with fresh ideas
• Direct ownership by the state through a special vehicle, the State’s Direct Financial Interest, with a fiscal profile.
• And not least, a dynamic Norwegian based supply industry — both Norwegian and international — that competes successfully at home and abroad.

To secure variations among the companies on the Continental Shelf, we have low barriers to entry.

New companies are welcomed.

We believe this system ensures a richness of ideas, technologies, and strategies, both in exploration, development, and operations.

Second, we have stable and predictable fiscal terms.

The overall tax system is based on the ordinary company tax system combined with a special petroleum tax. The combined tax level is high – at 78 percent – but it is predictable and transparent.

With a cash-flow based special petroleum tax the companies will have a reasonable efficient taxation.

This encourages new companies to explore, innovate, and take risks.

Third, we have open access to infrastructure.

Pipelines and other facilities must be available for third parties at regulated conditions.

This creates efficiency, lowers costs, and promotes competition.

Fourth, we allocate licenses based on a discretional assessment of applicants.

We evaluate technical competence, financial strength, and long-term commitment.

There is a high level of trust between companies and the state.

Everyone knows the rules – and the rules are long term based.

Finally, we have built a sovereign wealth fund – the Government Pension Fund Global.

All net cash flows from petroleum activities go into the fund.
The fund is invested globally, and only a small part of it is used each year to support the national budget.

The level of activity on the Norwegian continental shelf has been high in recent years.

During the COVID-19 pandemic, we introduced a special activity package for the oil and gas sector.

This helped maintain investment levels and exploration activity during very uncertain times.

It has been a success, showing that good policies matter.

Governments can and should act to ensure stable, long-term conditions that allow industry to invest with confidence.

We are also deeply committed to reducing greenhouse gas emissions.
And we believe that oil and gas production and climate responsibility must go hand in hand.

• We introduced strict regulations regarding flaring and venting from the very beginning. The idea was based on resource management considerations – oil and gas are too valuable to be wasted
• We then introduced a CO2 tax on offshore production already in 1991 – among the first in the world.
• We are electrifying offshore platforms, pipelines, and vessels.
• We have a strong focus on energy efficiency to reduce emissions.

Today, upstream oil and gas CO2 emissions on the Norwegian continental shelf are among the lowest in the world – and they are still going down.

We believe that high carbon prices are a powerful incentive.
They drive companies to innovate and cut emissions, while still delivering the energy that the world needs.

Looking ahead, this government is focusing on further development of the Norwegian petroleum industry:

• We have increased investment in exploration and new developments.
• We continue to award new licenses, to mitigate the expected decline in existing producing fields
• We are opening new areas for carbon capture and storage, offshore wind, and other low-carbon industries.

Our policy goes well with the European needs for Norwegian oil and gas for many years to come.

The role of the government is to provide a stable and predictable framework that enables investments – both in hydrocarbons and in low- and zero-carbon solutions.

Again, the Norwegian experience shows that good governance can maximize the benefits of natural resources for the whole society.

It shows that it is possible to combine:

• High state revenues,
• Strong companies,
• A competitive and innovative industry,
• Low emissions,
• And a long-term perspective.

It also shows that trust between the state and companies is essential.

Predictability, transparency, and professionalism create trust.

Trust enables investment.

And investment enables long-term value creation.

I believe that many of the principles behind the Norwegian model can be adapted to different national contexts.

Each country must find its own path – but some lessons are universal.

In closing, I would like to emphasize three messages:

First, good resource management matters — not just for producing countries, but for the whole world.

Done right, it can create jobs, finance welfare, support the energy transition, and contribute to global stability.

Second, good management is not a coincidence. It requires clear principles, strong institutions, political will, and broad societal support.

Third, the future will belong to those who are able to combine responsibility with innovation — who are willing to adapt, to raise standards, and to think long-term.

Norway stands ready to share our experiences and to learn from others.

In these times of global uncertainty, it is more important than ever that we share experiences, learn from each other, and continue to develop responsible, sustainable, and value-creating energy industries.

We believe that by working together, we can make the petroleum sector a positive force for the future — for our countries, for our people, and for our planet.

Thank you for your attention.