How Norway became one of the richest countries in the world- Oil industry

 

 

The first mention of the existence and the possibility of extracting energy resources from the continental shelf have already appeared in the fifties of the twentieth century, but the issue was approached with skepticism. A letter from 1958, from the Ministry of Foreign Affairs was: “The possibility of finding oil or natural gas on the continental shelf may be quite small.” A year later, companies Esso and Shell have announced that there has been discovered natural gas deposits off the coast of Groningen (The Netherlands). The big oil companies focused on the North Sea. Initially, the study included only around the coastal Netherlands, Germany and Denmark, but in 1962 companies Phillips Petroleum and Mobil became increasingly interested in the Norwegian continental shelf.

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Despite the dominance of large corporations, five French companies succeeded in 1963 in persuading to cooperate with a large Norwegian company Norsk Hydro in order to search and administrate the potential deposits.

In 1966 the company Phillips Petroleum brought from the US a platform called Ocean Traveler. The first wells in the NCS began on July 19 on the platform Ocean Viking.

Early in the morning of August 30, 1969, there was a breakthrough. In the end, Ocean Viking reached, as it turned out, a huge deposit. It took the geologists of the US company Phillips Petroleum many days to estimate the quantity of oil. Finally, on December 23, 1969, perhaps the biggest and nicest Christmas surprise was made to the society. The news was quite big, as many years of searching did not give any tangible results. The first ever oil deposits in Norway was called Ekofisk (eng. ecofish).

In the seventies of the twentieth century, there was a whole series of new discoveries, the most important being the discovery of gas deposits Frigg by the French company Elf (now Total), and a giant oil deposit Statfjord was found by an American company Mobil.

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The oil industry in Norway today

1973 – Oil Crisis

Oil-producing countries in OPEC started in October a boycott of countries that supported Israel in the Yom Kippur War. In October oil prices increased by 70 percent, followed by a new increase of 130 percent in December. Before the crisis, oil prices hovered around $ 2.8 per barrel.

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When the crisis was over in 1974 the price was about $ 10.5 per barrel. In Norway the crisis led to that all gas stations were closed on Saturdays and Sundays and after 19.00 on weekdays. From the beginning of December it also introduced a ban on driving a motor vehicle on weekends. Petrol rationing was prepared from January 1974, although this was ever implemented. An unusually mild winter and widespread hoarding led to that restrictions in Norway was abolished in February 1974. The oil crisis led to the event of Norwegian tanker trade going into a prolonged crisis.

 

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3 thoughts on “How Norway became one of the richest countries in the world- Oil industry

  1. Hello Sandra, I enjoyed reading your entry on the Norwegian oil phenomenon very much! I thought it was very informative and well set out. The text flowed nicely and encouraged me to continue reading the article. However, I would like to know what happened to the Norwegian oil industry after the crisis in the seventies. Can you write a continuation that would bring this post up to date? 🙂
    best regards
    Paul
    PPU student
    University of Oslo

    Liked by 1 person

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