July 11 (UPI) — The Norwegian government said Wednesday that technical problems at offshore fields means oil production was about 4 percent below expectations.
Norway derives much of its own power from renewable resources, sending nearly all of its offshore oil and natural gas production to the European market. That makes Norway an important producer for a European economy trying to break the Russian grip on the regional energy sector.
If Norway were a member of the Organization of Petroleum Exporting Countries, it would be the seventh-largest producer behind Nigeria.
The Norwegian Petroleum Directorate, the nation’s energy regulator, reported total production for oil in June averaged 1.48 million barrels per day.
“Oil production is approximately 3 percent lower than the NPD’s forecast, and about 4 percent below the forecast this year,” the government’s report read. “The main reasons that production in June was below forecast is technical problems on some fields.”
It’s the second month in a row the NPD attributed a decline in production to technical issues. Oil production in May averaged 1.5 million barrels per day.
Oil revenues account for about 14 percent of the Norwegian gross national product. Tax revenues from petroleum activity in the country jumped last year, when compared with 2016, because of better crude oil prices.
Statistics Norway, the government’s record-keeping office, reported GDP increased 0.6 percent in the first quarter, the fifth quarter in a row for growth in the range of 0.6 and 0.7 percent.
Production figures for July could be impacted by labor issues. Hundreds of workers on nine offshore installations in Norwegian waters opted for labor action to press for higher wages on Tuesday.
Another 900 workers on 20 installations could take further action July 15 unless a settlement is reached.