Norway Warns Statoil Against Stalling North Sea Project

MOSCOW (Sputnik) — Norwegian government keeps Statoil from shelving Snorre 2040 project in the North Sea inspite low oil prices, Bloomberg reported.

The 300 million-barrel oil project is aimed at prolonging the Snorre field's lifetime by constructing a new platform and increasing its production volume. The Snorre oil field has been operational since 1992.

"That's something authorities need to focus on, that the resources in Snorre 2040 are actually realized," Norwegian Petroleum and Energy Minister Tord Lien told Bloomberg in an interview.

He added that the Snorre 2040 project was more "time-critical" than investing in new developments.

On Friday, Statoil announced its intention to cut spending to protect returns amid falling oil prices. Snorre 2040 was among projects the company was intending to stall in order to ensure financial flexibility.

In January 2015, several other energy companies, including Royal Dutch Shell, Premier Oil, Tullow Oil and BP, announced plans to cut expenses by putting new projects on hold and laying off hundreds of workers due to falling oil prices. In January 2015, the world's largest oil service company, Schlumberger, announced that it would cut 9,000 jobs.

Global oil prices have significantly fallen since June 2014. The Organization of the Petroleum Exporting Countries (OPEC) in November 2014 decided not to cut oil output levels despite the oil price slump, which contributed to a further drop in prices. The price of Brent oil, which stood at around $110 per barrel in June, is currently hovering around $56 per barrel.