Norway Is Accelerating Its Oil and Gas Industry
Norwegian Coastal Cities in Wintertime—Hammerfest. Source: iStock.com/koekeloer
The unfolding unprecedented global energy crisis, caused by the illegal US and Israeli attack on Iran and the subsequent closure of the world’s main economic artery, the Strait of Hormuz, has triggered a reflexive reaction from oil and gas exporting countries to urgently increase production of these energy resources.
Norway produces approximately two percent of the world’s oil and three percent of its gas, and due to the small size of its non-oil and gas industry, it exports almost all of its produced energy resources primarily to Europe, which accounted for 86% of the country’s total oil exports in 2025.
2025 was also another year of high exports of Norwegian natural gas to Europe. 114.9 billion standard cubic meters of gas flowed through the integrated transport system, from the Norwegian continental shelf to European recipients.
The Norwegian continental shelf accounts for about 30 percent of gas consumption and 14 percent of oil consumption in the EU and the UK. Total petroleum production on the Norwegian continental shelf in 2025 was approximately 239 million standard cubic meters (Sm³) of oil equivalents. Total production is expected to remain at the same level in 2026.
Norway enjoys a unique geographical advantage relative to its primary oil and gas market—Europe—and can count on long-term energy cooperation with the region for the foreseeable future.
Europe’s upcoming complete phase-out of Russian gas in November 2027 will leave the vacated market share to LNG producers from various regions, primarily the United States. Norway, however, also plans to increase its presence in the European gas market by reopening gas fields closed for nearly thirty years, with supplies beginning in 2028.
Norway’s natural advantage is its existing pipeline network, which reduces costs and makes Norwegian gas a strong competitor to LNG from other regions. However, Norway, even if it wanted to, will not be able to significantly increase gas production from depleted fields, although it will capture some additional share of the European gas market.
An additional bonus for the European gas market will be price competition between Norwegian pipeline gas and overseas LNG, which should reduce the cost of this energy resource for European economies.
For the Norwegian government and the country’s oil and gas lobby, geopolitical upheavals appear to have become an opportunity to develop the country’s fading oil and stagnating gas industry, which has been gradually reducing oil production since 2001. Gas production in the country has remained roughly stable for the past eight years.
At a meeting of Norwegian oil and gas industry representatives and the government on May 5 in Stavanger, important announcements were made about a major push in the development of offshore oil and gas fields on the Norwegian shelf to increase energy supplies to Europe.
The Norwegians are planning to move at an unusual pace: September 1, 2026, marks the deadline for applications to develop 70 blocks in the North, Norwegian, and Barents Seas, and early next year, the winners of tenders for the development of new oil and gas fields will be announced.
The greatest hopes are pinned on the oil and gas Eldorado of the Barents Sea, where companies will begin exploratory drilling on 38 blocks, including in waters located within the ice edge—that is, the ice that forms by April and represents the seasonal expansion of the Arctic Ocean ice cap.
Currently, there are three producing fields in the Barents Sea. Five discoveries were made in this sea area in 2025. The largest discovery in the Barents Sea, proven in 2013, is 7324/8-1 (Wisting).
The resource accounts for the Barents Sea show that 13 MSm³ of o.e. were sold and delivered from this part of the Norwegian shelf over the past year. At year-end, the reserves amounted to 264 MSm³ of o.e.
The estimate for undiscovered resources in the Barents Sea is 2190 MSm³ of recoverable o.e. This is distributed between 1100 MSm³ of oil and 1090 GSm³ of gas. Exploration in the Barents Sea over the past five years has given mixed results. Exploration close to infrastructure has given good results, while wells in new areas were less successful. The average discovery size in this period is about 4.3 MSm³ o.e.
In the Barents Sea, 54 percent of the resources are located in areas that have not been opened for petroleum activities, primarily in the Barents Sea North. This is the area with the greatest likelihood of making major discoveries on the Norwegian shelf. There are significant uncertainties associated with the estimates in these areas.
As the publication below shows, Norway’s plans for accelerated, large-scale oil and gas expansion in the Arctic, with its vulnerable nature, are drawing strong condemnation from both parliamentary parties and public organizations, who are calling for their abandonment.
Proponents of the “drill, baby, drill” ideology have their own truth: the country needs to develop the economy, create value, fill the budget, and ensure Europe’s energy security.
In a few years, it will be clear whether there is an oil and gas Eldorado in Norwegian Arctic waters, or whether hundreds of billions of kroner have been wasted drilling deep holes in the seabed in waters dangerously close to the edge of the polar ice cap.
The Fourth Largest Exporter of Natural Gas in the World
Norway is a small player in the global crude market with production covering about 2 percent of the global demand. Norwegian production of natural gas covers approximately 3 percent of global demand; however, as an exporter Norway is a significant player.
Norway is the fourth largest exporter of natural gas in the world, behind the US, Russia, and Qatar. In 2024, Norway exported a gas volume equivalent to more than 30 percent of the total gas consumption in the EU and the United Kingdom.
An extensive network of subsea pipelines links Norway’s offshore gas fields and onshore terminals directly to other recipient countries in Europe. The total length of the Norwegian gas pipeline network is about 8,800 kilometers, which is roughly the distance from Oslo to Bangkok.
In addition, liquefied natural gas (LNG) is shipped out from the Snøhvit field off Hammerfest on LNG carriers. Approximately 5% of Norwegian gas exports is LNG.
The value of Norwegian gas exports in 2025 was higher than the value of Norwegian oil exports (including NGL and condensate), as a result of high gas production and relatively high prices. Domestic consumption of gas in Norway is very low, and nearly all the gas produced is exported.
Reopening Three “Dead” Gas Fields in the North Sea
The government is reopening three gas fields to ensure Europe has more energy. At the same time, more oil and gas will be searched for in 70 new places, unusually close to the coast.
Jonas Gahr Støre and the Energy Minister attended a meeting with the oil industry in Stavanger on May 5. The government will open up three old fields in the Ekofisk area in the North Sea. This will supply a pressured Europe with Norwegian gas.
On May 5 the government approved the development plans for the three gas fields Albuskjell, Vest Ekofisk, and Tommeliten Gamma. They are all located in the southern part of the North Sea.
Production Period 2028–2048
The fields were originally shut down in 1998. When the government now decides to invest around 19 billion ($2.07 billion) to restart them, there is one reason in particular: the situation in Europe.
It is expected to extract between 90 and 120 million barrels of oil equivalents.
The fields will mainly produce gas, but also some condensate.
The development and operation are expected to provide a total of 7,600 man-years over the fields’ lifetime.
The plan is for the first gas to be extracted at the end of 2028, and for the fields to produce until 2048. The gas will be sent by pipeline to Germany, while condensate will be sent to the UK.
Oil and gas prices have risen sharply after the US and Israel attacked Iran on February 28. Oil companies are producing at full capacity and are profiting from the high prices.
Vest Ekofisk, Albuskjell, and Tommeliten Gamma were discovered in the 1970s and put into production between 1977 and 1988. In 1998, all three fields were shut down as a result of a reconstruction of the Ekofisk field.
Expanding the Exploration Area by 70 Blocks
At the same time as the old fields are being opened, the government has decided that oil companies will be allowed to explore for more oil and gas.
On May 5 the government has announced 70 new “blocks”, i.e. areas on the seabed where companies can apply to explore. They are distributed as follows:
- 38 blocks in the Barents Sea.
- 10 blocks in the Norwegian Sea.
- 22 blocks in the North Sea.
Never before has exploration been opened up so close to the coast as now.
Think the EU Would Rather Have Norwegian Gas
Thina Saltvedt is chief analyst at Nordea. She says the news from the government is a clear sign that they will focus fully on oil and gas in the future.
“Some of the blocks are located close to existing infrastructure, so it can come to market quickly. If it is not located close to infrastructure, it will take a long time. Then the question is to what extent is this needed in the long term,” she asks.
Saltvedt believes that the reopening of the gas fields is solely due to demand from Europe due to the situation in Ukraine and the Middle East.
“The EU has received little gas from the Middle East during the war. This has been replaced by American gas. The relationship with the US may mean that the EU wants deliveries from other partners as long as there is a need,” she says.
Partners Are Furious
Oil companies have until September 1, 2026 to apply for exploration, and the awards will take place in early 2027.
Several of the areas being opened up for exploration are close to the coast. The Norwegian Environment Agency has strongly warned about this, because it could potentially lead to activity near the coast.
But the government has set these recommendations aside.
Socialist Left Party’s environmental policy spokesperson Lars Haltbrekken lashes out at the government after hearing the announcement.
“It is madness and shows that the government is once again blatantly ignoring environmental advice from its own experts. All the talk about responsible oil extraction is just nonsense. It is greenwashing from start to finish. Vulnerable, important natural assets are being put at risk with their eyes open,” says Haltbrekken.
“Opening 70 new blocks, several of which are in the ice edge zone, is an enormous climate and natural tragedy and a slap in the face to everyone in Norway who is concerned with combating climate change,” says Member of Parliament from the Green Party Frøya Sjursæther.
“It is sad to see that the government defies the Norwegian Environment Agency’s recommendations and opens up for oil exploration in such coastal areas. It is frightening,” says the Red Party’s deputy leader Sofie Marhaug.
The Red Party believes that the government must stop competing with the Progress Party in oil policy and start taking climate and nature more seriously.
The Government’s View: Avoid Production Decline
Energy Minister Terje Aasland believes that there is reason to raise the flag in the oil city of Stavanger.
“We know that we are heading towards a production decline if nothing is done. If we are to continue to be a stable, long-term supplier of energy to Europe, we need to explore more, find more, and invest more in the future,” says Aasland.
When asked about the Environment Agency’s warnings against coastal exploration, the minister replied that safety is being assessed on an ongoing basis.
“It is assessed in each individual case where we are going to grant permits. If there is a need for more safety around these projects, it will be implemented in connection with the permits to be granted.”
The Progress Party Believes It Is Going Too Slowly
The Progress Party’s member of the Energy and Environment Committee, Kristoffer Sivertsen, does not think the government is going far enough.
“When the world is in the middle of the worst energy crisis ever, Energy Minister Terje Aasland is meeting it at a snail’s pace. This is far from good enough,” says Sivertsen.
He wants to carry out the 26th licensing round, which means exploration in completely new and unknown areas where it is hoped to find the really big gas sources for the future.
“In a new licensing round, it will take years before new areas can be opened. How does that remedy the current situation?”
“It is unclear how long we will be in an uncertain energy situation. In recent years, we have seen such situations several times, and therefore it is about laying the foundation for the future today. We are doing this by opening areas where we know there are large resources.”
Energy policy spokesperson Aleksander Stokkebø in the Conservative Party says Norwegian oil and gas are crucial for European energy security, value creation along the coast, and Norwegian welfare.
“The Conservative Party is therefore pleased that we got our proposals through the Storting on the petroleum notification and the 26th licensing round, which have formed much of the basis for this announcement,” he says.
Such Different Opinions
According to Frode Alfheim at the Styrke national conference, this is good news:
“It is important that we do what we can to maintain high activity on the Norwegian shelf. And I expect broad political support for both this work and the work on a new petroleum report.”
“Europe is crying out for Norwegian oil and gas. The demand for Norwegian pipeline gas is significant in the decades ahead.”
Hildegunn T. Blindheim in Offshore Norway also believes that this is good news. Access to attractive acreage and exploration is crucial for Norwegian jobs, value creation, and for the energy nation Norway to be able to maintain its position as a stable and predictable supplier of energy.
“Access to attractive acreage and further exploration is therefore absolutely crucial.”
Anne Marit Post-Melbye in Zero:
“We will not solve a fossil energy crisis by searching for more oil and gas in immature areas such as the Barents Sea. The government should rather take into account the need for restructuring the Norwegian economy and help solve the world’s fossil dependency, not reinforce it.”
Sigrid Hoddevik Losnegård in Nature and Youth:
“This is very serious. Awakening dead oil fields is fatal for Norwegian nature, industry, and the climate, and completely the wrong path for a government that says it wants to contribute to a green transition.”
Haldis Tjeldflaat Helle in Greenpeace Norway:
“This is madness. Once again, the government chooses to dance to the tune of the oil companies, rather than taking responsibility for the community, vulnerable nature, Norway’s climate commitments, and the right of children and young people to a safe future.”
Grunde Almeland in the Liberal Party:
“This is a declaration of eternity for the oil sector when what we desperately need is restructuring and less fossil dependency.”
“Now the Socialist Left Party and the Green Party must wake up. This is the government they have chosen to support, and we have hardly had a more expansive oil policy than the one being pursued now. It is urgent to get Norway back on the right course in climate policy.”
Prime Minister Støre: Decisive
The Prime Minister emphasizes that the oil and gas industry is crucial for both Norway and Europe.
“The government is today announcing new exploration areas to further develop the petroleum sector, so that it can continue to create great value for the community, lay the foundation for good jobs throughout the country, ensure our common welfare, and contribute to Europe’s energy security and safety,” he says.
Energy Minister Terje Aasland points out that Russia’s special operation in Ukraine and the conflicts in the Middle East have made stable Norwegian deliveries more important than ever.
“Norwegian production of oil and gas is an important contribution to energy security in Europe.”
A Responsibility as Producers
The news comes on the same day that it became clear that this year’s April is the warmest recorded in Northern Norway. 2025 was the warmest year on record in Norway. Human greenhouse gas emissions continue to heat up the Earth. The main reason is the use of fossil energy.
“Climate change and its consequences continue to escalate. How is this taken into account when you open up new, large areas for oil and gas?”
“It is also the consumer who must take responsibility. We have taken responsibility by developing, and now demonstrating, a value chain for carbon capture and storage as an example,” says Aasland.
“These are solutions that are absolutely crucial for us to succeed with the climate challenges as well.”
Aasland also says that Norway supplies oil and gas with a very low climate footprint and is focused on cutting emissions from production.
“Are consumers responsible?”
“We have a responsibility as producers to produce with the lowest possible emissions and cut emissions from production. We do that. We take that responsibility very seriously. Then there are also major emission points, major consumers, who also have a responsibility when they use this oil and gas. That they manage to do this in the best possible way.”
Source:
- NRK (in Norwegian)
- Norskpetroleum
- Regjeringen
