Norwegian Petroleum Directorate Says No Reason to Stop Deepwater Drilling

The Norwegian Petroleum Directorate said there’s no reason to curb or halt deepwater drilling after the Gulf of Mexico oil spill, clashing with the country’s oil minister.

“We don’t see any reason to postpone or stop the activity in deep water,” Bente Nyland, head of the agency, said in an interview today in Stavanger, Norway.

U.S. President Barack Obama declared a six-month moratorium on offshore drilling last month as a presidential panel probes the explosion and sinking of the BP Plc-leased Deepwater Horizon rig, which killed 11 workers, spilling as many as 19,000 barrels of oil a day into the Gulf of Mexico.

Norway won’t award deepwater drilling permits in new areas until the causes behind the Gulf of Mexico incident have been determined, Oil Minister Terje Riis-Johansen said today.

“The Gulf of Mexico is the Gulf of Mexico and Norway is Norway and we’ve had deep water drilling for many years,” Nyland said. “It is not necessarily the water depth that is the main issue. There are other issues such as the depth of the reservoir, which is fairly deep in the Gulf of Mexico and shallower below the seabed in Norway.”

Norway, the sixth-biggest oil exporter, is opening up new areas for exploration further north, in deeper waters and harsher climates, to counter dwindling production from its maturing North Sea fields. Royal Dutch Shell Plc is preparing to drill a new well at its Gro natural-gas discovery in the Norwegian Sea with the Aker Barents rig at record depths.

“This will have no consequences for ongoing activity” in deep waters, Inger Anda, a spokeswoman for the Norwegian Petroleum Safety Authority, said by phone from Stavanger today. “There have been no changes to the approval to drill at Gro. There’s no reason to retract it.”

The Gro discovery was made 360 kilometers (224 miles) offshore Broennoeysund in Nordland in a wildcat well at a depth of 1,376 meters (4,515 feet), the greatest water depth ever in Norway. The find holds an estimated 10 billion to 100 billion cubic meters of recoverable gas, according to the petroleum directorate.

“We’re working continuously on gathering information on the Deepwater Horizon case and we’ll initiate changes to the regulations should that prove to be necessary,” Anda said.

To contact the reporter on this story: Josiane Kremer in Oslo at Jkremer4@bloomberg.net; Marianne Stigset at mstigset@bloomberg.net

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