Install

Get the latest updates as we post them — right on your browser

. Last Updated: 07/27/2016

Directors of Norway's Statoil Recommend Stake Sell-Off




OSLO, Norway -- The board of Norwegian state-owned oil company Statoil recommended a partial privatization of the company in a report delivered Friday to Oil Minister Anne Enger Lahnstein.


The board met last week to discuss its views on the future structure of the Norwegian oil industry. But board chairman Ole Lund would not disclose the report's conclusions until it had been passed to the government.


In February, the Norwegian parliament is slated to come to a decision regarding the future of the country's oil and gas industry, based on a white paper from the government.


Norwegian media had predicted a recommendation of the partial privatization, noting that Statoil chief executive Harald Norvik has expressed support for reducing the state's ownership, as have some members of the board.


The report was also expected to review the different forms that a commercialization of SDOE, which controls the Norwegian state's offshore oil and gas interests, could take, as well as the possibility of merging SDOE and Statoil.


Such a merger would create one of the world's largest oil groups, valued at somewhere between 500 billion and 600 billion kronor ($6.5 billion and $7.8 billion), with oil and gas reserves amounting to 17 billion barrels.


The three groups that are larger are Exxon Mobil, BP Amoco and Royal Dutch/Shell, each controlling 20 billion barrels of reserves.


A spokeswoman for the Oil Ministry, Sissel Edvardsen, confirmed last week that the government is considering a possible merger of Statoil and SDOE, but she stressed that such a move is only one of several options being studied.


Other alternatives include transferring parts of SDOE to other companies, such as state-controlled Norsk Hydro, which recently acquired part of privately owned Saga Petroleum.


SDOE was created by the government in the 1980s to fend off a potentially overwhelming Statoil dominance in the Norwegian economy and on the continental shelf. SDOE owns 40 percent of Norway's petroleum reserves, and is managed by Statoil on the government's behalf.