Norway expects oil and gas investment to further decline over the next two years as more projects are shelved.
According to a report published by Statistics Norway, the country will see investments in oil and gas extraction and pipeline transport fall to $19.93 billion (NOK 163.5 billion) this year.
That figure represents a 1.5 percent decline from the agency’s previous estimate for 2016.
The agency said the decrease is mainly tied to lower estimates for the field development and shutdown and removal categories.
The dip in field development is partially due to some fields coming on stream and being removed from the field development category, the report said.
The agency’s 2016 estimate is 17.5 percent lower than the corresponding estimate for 2015 that was given in the third quarter of last year.
“The decrease from 2015 to 2016 is due to lower investments within all categories, but the main contributions come from field development, fields on stream and exploration,” Norway Statistics said.
The agency now expects investments in oil and gas extraction and pipeline transport for 2017 to come in at about $18.34 billion (NOK 150.5 billion), a 1.8 percent decrease from the agency’s previous estimate.
Lower estimates for shutdown and removal projects were responsible for the majority of that decline.
According to the report, the investment estimate for the shutdown and removal category fell by 25 percent compared to the agency’s previous measurement taken in the second quarter of 2016.
The decline was attributed to the postponement of several shutdown and removal projects.
Investment estimates for exploration activities also fell while estimates for field development increased.
The field development increase was partially tied to the delivery of two development and operation plans earlier this quarter, the report said.
The agency’s current estimate for 2017 investment levels is 18.6 percent lower than the corresponding estimate for 2016.
The report found that 2017 investments in the field development, fields on stream and exploration categories are showing a “particular decrease compared to corresponding estimates for 2016.”
The agency said there is “reason to believe that the sharp decrease indicated in this quarter’s survey might be moderated in future surveys.”
However, the report added that if the investment decline from 2016 to 2017 seen in the present survey persists than estimates for 2017 may have to be revised downward again.