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UK-Norwegian division finalised

person Norwegian Petroleum Museum
The division of petroleum resources in the Statfjord area between Norway and Britain was subject to continuous assessment from the time production began until the late 1990s. Substantial resources were devoted to this time-consuming process.
— Norwegian and British flag
© Norsk Oljemuseum

A preliminary division was first established in 1976, with Norway allocated 88.88 per cent of the field. That left the UK with 11.12 per cent. It was clear from the start that this assessment would have to be adjusted, and the Norwegian share was reduced in 1979 to 84.09 per cent.

As more information on the reservoir became available, the question arose of whether that division was correct. Negotiations were pursued during the 1980s on a further redetermination. Norway’s share was increased to 85.23869 per cent in 1994. Each decimal was important, and represented substantial assets. But the UK maintained that the Norwegians had obtained too much and demanded further talks.

What came to be the final redetermination began in 1995 and was not completed until 1998. The British took a bombastic line and maintained that their share could rise to 17 per cent, but that proved to be far from the case. This process ended with the division changed to 85.46869 for Norway and 14.53131 for the UK. So it was the Norwegian share which rose, by 0.23 per cent. That deal was sanctioned by the two governments in 1998.

The increase in Norway’s share actually resulted not from the 1995-98 redetermination but from the award made by an independent expert in the 1989-91 process. This specified that, if production from the Cook formation in the reservoir – which was primarily productive on the Norwegian side – began before 1995, Norway’s holding should rise by 0.23 per cent.

So the lengthy negotiations had failed to yield major changes, which did not quite accord with the great tensions aroused by these talks. But both sides could live with the outcome, and that was the most important consideration.

To learn more, see the article by Håkon Lavik on the final redetermination .

Polycrown can departStatoil reported to the police
Published December 2, 2019   •   Updated January 2, 2020
© Norsk Oljemuseum
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