Norwegian state firm Den norske stats oljeselskap AS (Statoil) is embarking on a strategy to double production, with greater emphasis on overseas output.
Harald Norvik, Statoil president and CEO, told a London meeting last month the company also plans to position itself increasingly as an energy provider rather than an oil and gas company.
"Statoil will expand," said Norvik, "but we are not mainly looking for size. In part of our business, however, size is a factor, if we are to reach our growth targets: to almost double our current energy production by 2005. Then I want Statoil to be a 1 million b/d (equivalent) producer of equity oil and gas."
Current status
Statoil gets most of its current 1.3 million b/d of oil equivalent (boed) output from 10 fields in the North Sea.
The company handles more than 2 million boed of equity crude, state-owned oil, and third party volumes, said Norvik, and has upstream assets in 16 countries.
"The Norwegian continental shelf will in 10 years time continue to be our core asset," said Norvik, "but from then, international assets will grow rapidly in importance.
"Last year we produced 30,000 boed internationally; in 2000, we have a target of 100,000 boed; and by 2005, the level should be 300,000 boed."
Norvik said that while oil will continue to have a major role in international energy markets for decades to come, natural gas use will grow significantly, and Statoil also will move into electricity markets.
Opportunities
"Liberalization and deregulation has its impact almost everywhere," said Norvik. "Scandinavia, where Stat- oil has a share of more than 20% of the oil products market, has become one of the world's most liberalized energy markets.
"It has opened new opportunities for companies like Statoil. Our scope of services will expand, offering more general energy supplies. The aim is to provide the customer with better service and a better product at a lower cost. We will also be involved in building the first two gas-fired power plants in the Nordic region, and more will come."
Statoil will call itself an energy company, said Norvik, in recognition of the changing industry and the changing market, in which inter-fuel competition will grow rapidly.
"More and more," said Norvik, "customers will not look to buy oil, gas or electricity, as they do today, but will look to buy light, heat, and transport fuel instead."
Price Waterhouse view
Norvik's prediction found an echo at another London conference soon thereafter, in a presentation by James Crump, chairman of Price Waterhouse World Energy Group.
Crump said, "The new energy age is characterized by the deregulation of electric and natural gas utilities and by the convergences of hydrocarbon and electron-producing companies and markets. Therefore, inter-fuel competition is intensifying.
"Energy companies are beginning to think of creative ways to bundle not just energy, but household products and services; from food, heating, cooling, and light to transportation; from entertainment to communications; from leisure to literally anything that can be ordered from and delivered to the home-all invoiced on one bill, all paid for with one credit or debit card.
"The winners will think and speak not of therms and watts, but of heat, light, and fuel. The losers will be any companies that practice business as usual."
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