Chuck Haga, Forum News Service, Published January 23 2013
Algeria attack could boost Norwegian oil stake in North DakotaGRAND FORKS – Last week’s terrorist attack on an Algerian oil facility could divert Norwegian oil giant Statoil to increased oil production in safer regions, including North Dakota’s Bakken and Three Forks formations, where the two-thirds government-owned Statoil already has made a heavy investment.
Five Statoil employees are among the missing after terrorists took hostages and Algerian forces stormed the facility. At least 23 hostages died.
Bloomberg News reported this week that security problems in Algeria and elsewhere in North Africa could prompt Statoil “to focus even more on shale oil and gas in the U.S. and deepwater fields off Brazil, where most of the company’s production growth is expected to occur in this decade.”
Statoil is expanding operations abroad to make up for falling production in North Sea oil fields, Bloomberg reported. High prices for oil combined with new drilling technology have the company looking to increase its U.S. output from 166,000 barrels a day to 500,000 barrels by 2020. That would be one-fifth of the Norwegian company’s total projected output by that time.
Statoil became a major player in the Bakken in 2011 through its $4.4 billion acquisition of Brigham Exploration, which gave it drilling rights to 375,000 acres in the formation. In October 2012, the company announced it had leased 1,000 railroad cars to transport Bakken crude to refineries on the East and West coasts, reducing reliance on truck transport.
A Statoil expansion in North Dakota would be “good news,” said Bruce Gjovig, director of the Center for Innovation at UND and a Norway booster.
“Statoil is a very good operator, investing heavily in technology as well as environmental and worker safety,” he said. “They are well known to take good care if their employees and encourage them to be active in their communities.”
When the Brigham Exploration deal was announced, Statoil President Helge Lund explained its significance with a statement posted on the company’s website.
“Entering the Bakken and Three Forks tight oil plays and taking on operatorship represents a new significant step for Statoil. We are positioning ourselves as a leading player in the fast-growing U.S. onshore oil and gas industry,” Lund stated.
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