| OSLO, Sept 16
OSLO, Sept 16 Oil firms in Norway, western
Europe's biggest oil and gas producer, asked the incoming ruling
parties on Monday to repeal a recent tax hike and open the
sensitive Arctic Lofoten archipelago to exploration.
Drilling around the Lofoten islands is becoming one of the
top issues in coalition talks among the four election-winning
parties and a new government is expected to uphold a drilling
ban, forcing oil companies into more remote and difficult
Although the top two parties which will make up the
government favour opening the area, which could hold around 1.27
billion barrels of oil equivalents, the smaller parties fiercely
oppose such a move, fearing the oil industry would endanger its
pristine environment, tourism and the world's largest cod
Needing the votes of the small parties for a majority, some
analysts expect the Conservatives and the Progress Party to
yield on Lofoten and sources close to two parties recently told
daily newspaper Aftenposten that the two are ready to give in.
But energy firms argue it takes 15 years to start production
from the time an area is opened to energy firms, so a delay now
would impact production beyond 2025, when output in the region
is already seen falling.
"To curb the production decline on the Norwegian continental
shelf beyond 2025, new areas need to be opened up urgently," the
Norwegian Oil and Gas Association, which represents dozens of
producers including majors such as Statoil, BP,
Chevron, ConocoPhillips, Royal Dutch Shell
and Total, said in letter to the four
"Keeping the northeastern Norwegian Sea closed for another
four years prevents a comprehensive and cost-effective
development of the shelf," it said.
It also argued that a new oil tax, the first in decades,
will reduce the profitability of marginal projects and will
likely lead to the cancellation of new developments, further
The Conservatives, Progress, the Liberals and the Christian
Democrats begun closed-door coalition talks on Monday and a
final deal is not expected for several weeks.