EurOil: Norway holds off on further frontier oil, gas licensing rounds until 2025

As Europe grapples with soaring energy prices that are widely expected to remain for years to come, Norway, the continent’s biggest natural gas supplier, has decided to hold off on future oil and gas licensing rounds in frontier zones until at least 2025.

The decision – made as part of a budget agreement between the minority government and the opposition Socialist Left (SV) party – will have little impact on near-term investment in Norway’s continental shelf. After all, it does not affect the annual Awards in Predefined Areas (APA) rounds that offer rights to acreage in more established and well-developed petroleum zones off Norway’s coast. However, it could dent prospects for additional Norwegian oil and gas supply towards the latter end of this decade.

While APA rounds garner more interest, given that the opportunities are lower-risk, Norway’s numbered frontier rounds provide operators with the chance to explore lesser-understood zones that could yield significant discoveries, particularly in the frontier Barents Sea. 

The minority government, comprising Norway’s Labour and Centre parties, are broadly in support of exploiting any opportunities the country has to maximise its oil and gas production. But, as a minority government, they must rely on the backing of the out-of-power Socialist Left, which is vehemently opposed to further hydrocarbon exploration and wants to see Norway’s economy become less dependent on revenues from oil and gas exports over the years to come.

The 26th licensing round will not take place while the current parliament is in power, which will be the case until 2025. 

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