Changing the operator

person By Håkon Lavik, former Statoil employee
Transferring the Statfjord operatorship from Mobil to Statoil ranks as one of the biggest controversies in Norwegian oil policy. The 1973 licence allowed a change of operator to be requested 10 years after a discovery was declared commercial, and Statoil asked to exercise this right in 1984. Mobil was opposed, and felt it would suffer a huge loss of prestige from such a transfer.
— Statoil takes over operator responsibility from Mobil. Martin Bekkeheien and Mike Smith pictured together with a model of Statfjord A. Photo: Leif Berge/Equinor
© Norsk Oljemuseum

The US major at least wanted a visible compensation for the loss of the operatorship. It asked first to become operator for block 30/6, which proved to contain the Oseberg field.

When that failed, Mobil “declared war” on Statoil and began to fight to retain the operator role. It argued that the state oil company had gone behind its back by securing the exploration operatorship for 30/6.

Although Mobil secured an interest in the block, it felt that this was not enough. Moreover, the operatorship for 30/6 was transferred from Statoil to Norsk Hydro in 1982 – Norway’s first political decision on such a change.

Mobil next sought to secure the operatorship for block 34/7, where Snorre, Vigdis, Tordis and Borg were to be discovered, but again without success. Norway’s Saga Petroleum became the operator – and Mobil was not even offered a holding in the block.

The Statfjord operatorship became a hot political issue during the early 1980s. That was because it involved Statoil and the size of that company, and because “clipping Statoil’s wings” had been a manifesto commitment for the Conservative Party in the 1981 general election. That promise in turn led eventually to the creation of the state’s direct financial interest (SDFI) in 1984, in effect from 1985.

Before that, however, the operator issue had to all intents and purposes been settled in 1983, with a formal decision in 1984. The question was considered by the standing committee on industry of the Storting (parliament) in 1983 in connection with the annual Statoil report to the committee.

Both Mobil and Statoil were asked to submit their arguments. The former decided to devote its time to rubbishing the state oil company. That annoyed so many members of the committee that its chair, Reidar Due, noted afterwards that a majority already existed for the fastest possible change of operatorship.

Operatørskiftet,
Kåre Kristiansen. Photo: Stortingsarkivet/Scanpix

Kåre Kristiansen from the Christian Democratic Party, who became petroleum and energy minister in 1983, was opposed to a transfer. So were prime minister Kåre Willoch and finance minister Rolf Presthus, both Conservatives.

However, a majority recommendation from the industry committee in favour of a transfer was backed by members of the Centre and Christian Democratic parties. Since these were both part of the governing centre-right coalition, this act was political dynamite.

The outcome was that Willoch himself contacted the committee and had the recommendation revised before the document was submitted to the Storting’s presidium. This meant in practice that Due and the other members of the coalition party – including Arnljot Norwich and Svein Alsaker – agreed to postpone the issue for a year. Kristiansen failed to grasp that.

When the issue came up again in the autumn of 1984, the fronts had consolidated. Mobil was battling desperately to retain the operatorship, while Statoil fought just as hard to secure it.

In an attempt to resolve the question without bringing down the coalition, local government minister Arne Rettedal asked the two companies to agree on a collaboration agreement.

Such a deal was actually drawn up, but rejected the following day by Mobil before it could be submitted to Rettedal and Kristiansen. This was because the US company had received clear signals from Kristiansen that a decision on the operatorship would be postponed, perhaps for a decade.

Before Mobil rejected the agreement, it asked Kristiansen whether he stood by his word. He did. But things fell apart when the deal was turned down. The government could no longer prevaricate, and the message from the industry committee was once again clear. Both the Centre and Christian Democratic Parties would support Labour and ensure a majority for a change.

If the issue was not resolved that autumn, the government would be defeated and might fall apart or have to resign. Faced with that prospect, the coalition resolved unanimously on the following day that the operatorship would be transferred.

The Storting followed up with a decision in December 1984, and the transfer was implemented painlessly during 1986. Statoil became operator on 1 January 1987. The transfer decision marked the end of the last major Norwegian political controversy over Statfjord.

Published October 30, 2019   •   Updated February 14, 2020
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