Norway Awards 57 Drilling Permits in Offshore Oil, Gas Exploration Round

In a significant move to bolster its offshore energy sector, Norway’s Energy Minister Terje Aasland announced on January 13, 2026, the award of 57 production licenses to 19 companies in the annual Awards in Predefined Areas (APA) licensing round.

This allocation, up from 53 licenses in the previous year, focuses on mature areas of the Norwegian Continental Shelf (NCS) and underscores the country’s commitment to maintaining high levels of oil and gas output amid Europe’s ongoing energy needs.

Major operators such as Equinor, Aker BP, Vår Energi, and DNO secured stakes, with 31 licenses in the North Sea, 21 in the Norwegian Sea, and 5 in the Barents Sea.

While environmental groups and the Green Party have voiced opposition, citing climate concerns, the government emphasizes the role of these permits in sustaining production for decades.

This latest round comes at a pivotal time for Norway, Western Europe’s largest oil and gas producer, which has navigated a complex balance between energy security, economic prosperity, and global climate goals. Below, we delve into Norway’s oil and gas production trends over the past decade, its key export markets, major fields, the strategic pivot in its energy policy, current investment levels, and potential returns for industry players.

A Decade of Steady Production Amid Maturing Fields

Norway’s oil and gas production has remained robust over the last 10 years, transitioning from a peak in the early 2000s to a more stable output supported by new discoveries and enhanced recovery techniques. In 2025, total marketable petroleum production reached 238 million standard cubic meters of oil equivalents (Sm³ o.e.), a slight decrease from 241.2 million Sm³ o.e. in 2024 but still representing about 90% of the record 264.2 million Sm³ o.e. in 2004.

Oil production has hovered around 2 million barrels per day (bpd), with 2024 figures at approximately 2,006,874 bpd, ranking Norway 12th globally.

Natural gas output has seen notable growth, hitting a record 121.5 billion Sm³ in 2025, accounting for about 50% of total production in oil equivalents.

 

Production dipped slightly in the late 2010s due to maturing fields but rebounded with developments like Johan Sverdrup, which reached near-peak output of 755,000 bpd by 2025.

Gas volumes have trended upward, driven by demand from Europe and infrastructure expansions.Key Export Markets: Europe’s Energy LifelineAs the world’s fourth-largest natural gas exporter behind the U.S., Russia, and Qatar, Norway directs nearly all its output to Europe via pipelines and LNG.

In 2024, it supplied over 33% of the EU’s gas imports, with major customers including the UK (nearly 40% of its gas consumption), Germany, France, Belgium, and the Netherlands.

Oil exports, comprising about 71% of production in 2020, primarily go to EU nations, with the UK and Germany as top buyers.

Norway accounts for around 2% of global oil and 3% of natural gas supply, making it a critical player in regional energy stability.

Major Fields Driving Output

Norway’s production is anchored by several giant fields across the North Sea, Norwegian Sea, and Barents Sea. At the end of 2025, 97 fields were active, with key contributors including:Troll: One of the largest gas fields globally, also a major oil producer; contains vast reserves in Late Jurassic sandstone.

Johan Sverdrup: The third-largest field on the NCS, with 2.7 billion barrels of reserves; peaked at ~755,000 bpd in 2025.

Ekofisk: The oldest major field (discovered 1969), with ~129 million cubic meters recoverable oil remaining; central to North Sea output.

Snorre: Holds over 64 million cubic meters recoverable oil; a key North Sea asset since 1992.

Statfjord: Discovered in 1974, with satellite fields; peaked at 5 million barrels in 2016.

Other notable fields include Oseberg, Gullfaks, Snøhvit, and Valhall, operated primarily by Equinor (70% of NCS production).

Remaining resources total ~7.6 billion Sm³ o.e., with a 50% average oil recovery rate.

The Policy Pivot: From Phasing Out to Europe’s Gas Powerhouse

Norway has long grappled with its dual identity as a climate leader and fossil fuel exporter. In the early 2010s, discussions around reducing oil production gained traction amid global emission goals, with some political factions advocating for a phasedown to align with Paris Agreement targets.

However, Russia’s 2022 invasion of Ukraine marked a turning point. As Russian gas exports to Europe plummeted from over 40% in 2021 to 8% in 2023, Norway ramped up output by ~8% in 2022, becoming the EU’s largest pipeline gas supplier by Q1 2024 (46.6% of imports).

This shift prioritized energy security, with exports reaching near-record 117.4 billion cubic meters in 2024.

The government now views oil and gas as essential for decades, planning a 2027 policy update to address long-term production while committing to halve emissions by 2030.

Investments like Equinor’s 12 billion NOK in the Troll field aim to add 7 billion cubic meters annually by 2026.

Surging Investments Amid Future DeclinesInvestments in Norway’s oil and gas sector hit a record 275 billion NOK ($27.4 billion) in 2025, driven by field developments, drilling, and inflation.

For 2026, estimates stand at 256 billion NOK ($25.5 billion), a 6.6% drop, with a projected decline to 209 billion NOK by 2030 as major projects wrap up.

Exploration costs were 33.5 billion NOK in 2025, yielding 21 discoveries from 49 wells.

State revenues from petroleum reached 664 billion NOK in 2025, expected at 521 billion NOK in 2026.

Returns for Companies: High but Maturing

Companies operating on the NCS can expect solid returns, though risks rise in a maturing basin. Lifecycle ROI for projects like Equinor’s Empire Wind (offshore wind hybrid, but indicative) targets 10%, while oil wells often see 15-25% annual ROI plus tax benefits.

Equinor’s 2023 reserves report shows a 103% reserves replacement ratio, with organic growth at 104%, signaling profitability amid high prices.

However, declining exploration (18% drop in wells for 2026) and output forecasts toward 2030 could pressure returns unless new discoveries materialize.

Firms like Aker BP and Vår Energi, focused on high-return assets, offer upside through dividends and capital efficiency.

Norway’s latest licensing round highlights its enduring role in Europe’s energy landscape, balancing production growth with sustainability imperatives. As investments peak and policy evolves, the sector remains a cornerstone of the nation’s economy.

Oil, Gold, Silver all going up. Copper is in the waiting room expecting to be next.