Oil and gas companies operating in Norway expect to invest a record 275 billion Norwegian crowns ($24.68 billion) in 2025, up from 263.7 billion this year and more than previously expected, the Offshore Norge industry association said on Monday.
The industry group had one year ago predicted oil and gas investments for 2024 and 2025 would amount to 240 billion and 225.9 billion crowns, respectively.
The higher investment is being driven by a mix of cost inflation, accelerated development and increased scope of work at several fields and the drilling of extra wells at existing oil and gas fields, Offshore Norge said.
Companies also plan to start drilling 45 exploration wells in Norwegian waters next year, up from 41 so far in 2024 and the highest level since 2019, the group added.
Norway is western Europe's largest oil and gas producer, with a total output of just over 4 million barrels of oil equivalent per day (boed), and aims to extend production for decades to come.
The outlook was based on responses from 14 companies including Equinor EQNR.OL, Aker BP AKRBP.OL, Vaar Energi VAR.OL, ConocoPhillips COP.N and Shell SHEL.L, representing close to 100% of the country's output.
After 2025, Offshore Norge's survey predicted oil investments will gradually decline, to 251 billion in 2026 and 203 billion crowns in 2029 as ongoing development projects are completed.
Equinor's Arctic Johan Castberg and Vaar's Balder X oilfields are expected to come on stream in the first and second quarters of 2025, respectively, and Aker BP's Yggdrasil field in 2027.
Investment estimates for 2029 could still increase, however, with oil companies adding new projects, although limited by a dearth of large new discoveries.
($1 = 11.1415 Norwegian crowns)
(Reuters - Reporting by Nerijus Adomaitis, editing by Terje Solsvik, Kirsten Donovan)