Key figures

 

About the report

 

This document constitutes the Annual report on Form 20-F in accordance with the US Securities and Exchange Act of 1934 applicable to foreign private issuers, for Statoil ASA for the year ended 31 December 2017. A cross reference to the Form 20-F requirements are set out in section 5.10 in this report. The Annual report on Form 20-F and other related documents are filed with the US Securities and Exchange Commission (the SEC). The Annual report and Form 20-F are filed with the Norwegian Register of company accounts.

 

The Statoil Annual report and Form 20-F may be downloaded from Statoil’s website at [Statoil.com/annualreport2017]. References to this document or other documents on Statoil’s website are included as an aid to their location and are not incorporated by reference into this document. All SEC filings made available electronically by Statoil may be obtained from the SEC at 100 F Street, N.E., Washington D.CC. 20549, United States or on the SEC’s website at www.sec.gov . 

 

 

2.1 Strategy and market overview

 

Statoil’s business environment

Market overview

In 2017 the world economy delivered the highest growth rate of the past six years. The world’s major economies are growing close to historical trends or above, and the emerging economies are recovering from their economic deceleration in 2016. The US economy is on a strong footing, with GDP growth estimated at 2.2% in 2017. Consumer spending, supported by higher employment, is the main driver of US growth. The Eurozone also showed robust growth estimated at 2.5%, thanks to private consumption and low inflation. In the UK, growth decelerated, with expected GDP growth at 1.8% due to uncertainty around the Brexit process. Chinese GDP growth has been reported at 6.9% in 2017, based on strong government policy stimulus, delivering an improvement in the growth rate for the first time since 2010. The Japanese economy performed relatively well, with an estimated growth rate of 1.8%, driven by a tight labour market, corporate earnings and a conducive external environment. As a notable exception, India at 6.5% growth, delivered below expectations as the economy had to adapt to the Goods and Services Tax and still felt the effects of demonetisation. Reduced inflationary pressure and appreciating currencies in Russia and Brazil have allowed central banks to cut interest rates, contributing to the countries’ economic recovery.

 

Looking forward, a robust demand picture and solid economic fundamentals should allow the expansion to continue. Among the risks that might affect such growth are geopolitical events and a too-fast monetary policy tightening from the central banks in key economies.

 

Global oil demand grew by 1.5 mmbbl per day in 2017 and global supply grew by 0.4 mmbbl per day. Decreasing oil prices in the first half of the year triggered both Opec and non-Opec countries to collectively honour their commitments to cut production. This resulted in stock draws and facilitated a gradual rebalancing of the market.

 

Overall, quarterly average European gas prices are up year-on-year throughout 2017. The first half of 2017 saw a downward trend in gas prices. However, in the second half of 2017, markets strengthened with demand growth in Asia leaving less LNG availability to serve a tight European market.

 

Oil prices and refining margins

A decreasing oil price in the first half of 2017 was followed by a strong second half with prices moving in an upward trajectory, closing the year at USD 66.5 per barrel. Refinery margins had a solid year fueled by strong demand in most products.

 

Oil prices
As in the previous two years, high volatility characterised the oil market. The average price for dated Brent crude in 2017 was USD 54.2 per barrel, up USD 10.5 per barrel from 2016. A relatively flat oil price fluctuating around USD 55 per barrel in the first couple of months was followed by a period of high volatility. Lingering worries about oversupply combined with surging output in Libya and Nigeria created a bearish sentiment with dated Brent bottoming out at USD 45 per barrel in late June. However, higher-than-expected demand and moderating global supply during the second half of 2017 put upward pressure on the commodity price. By the end of the third quarter, the price had reached almost USD 57 per barrel. Renewed buying interest in China and falling global stock piles facilitated continued rebalancing of the market throughout the fourth quarter. The upward pressure on the dated Brent oil price was strengthened even further by rising global geopolitical uncertainty, pushing prices to a two-year high of USD 62 per barrel in the first half of November. The Opec meeting in late November concluded with an agreement to extend oil supply cuts throughout 2018, with an option to review the deal in June. This gave support to the oil price through the last month of the year. Dated Brent was USD 66.5 per barrel on 31 December 2017. The futures market for Brent at the International Exchange Rate (ICE) was in contango until September before it shifted to backwardation and remained so for the rest of the year.

 

Over the course of 2017, global geopolitical unrest has been on the rise and received more attention as the market has become tighter.

 

US shale oil production has increased throughout 2017 due to continued productivity gains and cost reductions. The US is now delivering about 5 mmbbl per day of shale oil, with the Permian and Eagle Ford shale oil basins accounting for about two-thirds of the volumes. US crude oil exporters started to move cargoes toward high-growth markets in Asia as they capitalised on the favorable price differential. Development of Gulf Coast export capacity and crude price differentials are key determinants for future export levels.

 

Refining margins
Refining margins in Europe were strong in 2017. The moderate stock build in the first quarter of the year was followed by large draws in the next quarter due to strong demand. On the light end side, gasoline margins saw a moderate increase through the first half of the

 

year. High demand and strong prices for LPG, driven by changes in China’s energy mix, made the petrochemical industry take more naphtha, leaving less of the feedstock for making gasoline, eventually pushing prices. Stock draws in the US and strong demand in Europe supported diesel margins. The major impact of hurricane Harvey caused refining margins to peak by the end of the third quarter. A stronger physical crude oil market towards the end of the year put downward pressure on margins.

 

Natural gas prices

The upward trend in gas prices seen in the second half of 2016 continued into the first quarter of 2017, before taking a dip in second quarter 2017. The fourth quarter of 2017 experienced a robust price recovery.

 

Gas prices – Europe

NBP prices hit a decade low of USD 3 per mmBtu in August 2016, and increased towards an average of USD 5.7 per mmBtu in fourth quarter 2016. The climb continued into January 2017, averaging USD 6.6 per mmBtu, before falling throughout first and second quarter 2017 to USD 4.5 per mmBtu in June. Pipeline supply from the Norwegian Continental Shelf and Russia were at record highs of 117 bcm and 194 bcm respectively in 2017. However, the North-West Europe gas market has since late September 2017 been driven by a bullish combination of continued French nuclear outages, rallying coal prices, low hydro levels in Southern Europe and lower LNG availability in the Atlantic basin. The market tightened further due to the Rough storage shut-in and the new Groningen output ceiling, closing 2017 at USD 7.8 per mmBtu and resulting in an annual average of USD 5.8 per mmBtu.   

 

Gas prices – North America

The Henry Hub price remained stable throughout 2017, averaging USD 3 per mmBtu for the year. Prices peaked early in the year at USD 3.3 per mmBtu on seasonal uplift, before warmer weather weakened the market. Storage inventories have been consistently lower than levels last year, a main driver as to why prices are up year-on-year. The lack of a significant mid-year cooling related to demand peak left summer prices lower than normal and lower than the spring prices. In fourth quarter 2017, robust production growth has limited upside price risks and put a premium on winter heating loads as the market weighs new pipeline takeaway capacity slowly coming online in the Northeast.  

 

Global LNG prices

LNG prices in Asia ended 2016 at USD 9 per mmBtu. From here, monthly prices fell throughout first quarter 2017 and stabilised at USD 5.5 per mmBtu in second quarter 2017. The second half of the year experienced robust price recovery to an average of USD 9.4 per mmBtu in fourth quarter 2017, resulting in an annual average of USD 7.1 per mmBtu. Despite new LNG supply from Australia and the US, a marked pick-up in consumption across Asia has affected the market. Increased coal-to-gas switching to curb air pollution was seen in China. In South Korea and Taiwan gas stepped in for reduced nuclear capacity.

 

Statoil’s corporate strategy

Statoil is an energy company committed to long-term value creation in a low carbon future. Statoil will develop and maximise the value of its unique Norwegian continental shelf (NCS) position, its international oil and gas business and its growing new energy business, focusing on safety, value and carbon efficiency. Statoil is a values-based company where empowered people collaborate to shape the future of energy. 

 

Statoil's top priority in 2017 continued to be to conduct safe, secure and reliable operations with zero harm to people and the environment.

 

In 2017 Statoil launched its sharpened strategy. Geopolitical shifts, challenges in liquids resource replenishments, market cyclicality, structural changes to costs and increasing momentum towards low carbon implies uncertainty and volatility. To be prepared, Statoil is focusing on building a more resilient, diverse and option-rich portfolio, delivered by an agile organisation that embraces change and empowers its people. To deliver on the sharpened strategy, “always safe, high value, low carbon”, Statoil will continue to build opportunities to optimise its portfolio around the following portfolio areas:

 

·           Norwegian continental shelf – Build on unique position to maximise and develop long-term value

·           International oil & gas – Deepen core areas and develop growth options

·           New energy solutions – Create a material new industrial position

·           Midstream and marketing – Secure premium market access and grow value creation through cycles

The following strategic principles guide Statoil in actively shaping its future portfolio:

 

·           Cash generation capacity at all times – Generating positive cash flows from operations, even at low oil and gas prices, in order to sustain dividend and investment capacity through the economic cycles

·           Capex flexibility – Having sufficient flexibility in organic capital expenditure to be able to respond to market downturns and avoid value destructive measures

·           Capture value from cycles – Ensuring the ability and capacity to act counter-cyclically to capture value through the cycles

·           Low-carbon advantage – Maintaining competitive advantage as a leading company in carbon efficient oil and gas production, while building a low-carbon business to capture new opportunities in the energy transition

In order to deliver on the strategy, Statoil has identified four key strategic enablers that will continue to support the business’s needs:

 

·           Safe and secure operations

·           Technology, digitalisation and innovation

·           Empowered people

·           Stakeholder engagement

Statoil has a target to implement CO2 emission reduction measures equivalent to 3 million tonnes annually from its emissions between 2017 and 2030 and continues to make progress towards this goal. A significant portfolio of projects and initiatives has been established through 2017 with variable maturity to accomplish the 2030 commitments. Further communication on this can be found in Statoil’s 2017 Sustainability Report.

 

Norwegian continental shelf – Build on unique position to maximise and develop long-term value

For more than 40 years, Statoil has explored, developed and produced oil and gas from the NCS. Statoil aims to deepen and prolong its position by accessing and maturing opportunities into valuable production. At the same time, Statoil plans to improve the efficiency, reliability, carbon emissions and lifespan of fields already in production. The NCS represents approximately two thirds of Statoil’s equity production at 1,334 mboe per day in 2017.

 

Exploration: Statoil continues to be a committed NCS explorer across mature, growth and frontier areas. In 2017, Statoil participated in 17 exploration wells on the NCS, resulting in 10 commercial discoveries. Statoil was awarded 31 licences in mature areas in Norway’s Awards for Predefined Areas (APA) 2017 round (result announced January 2018), 17 as operator and 14 as a non-operating partner

Development: Statoil has submitted five plans for development and operation in 2017: Njord, Bauge and Trestakk in the Norwegian Sea, Johan Castberg in the Barents Sea and Snorre Expansion Project in the North Sea. Johan Sverdrup Phase 1 is proceeding as scheduled and the pre-sanction for Johan Sverdrup Phase 2 was approved by the partners in the first quarter of 2017. The Aasta Hansteen project continued as planned and the Oseberg H Unmanned Wellhead Platform was installed in 2017.

Production: Gina Krog came on-stream in 2017. Statoil opened the Valemon onshore control room, enabling remote control.

Statoil will take over operatorship and equity in the Martin Linge field and Garantiana discovery. Two Cat J rigs, Askeladden and Askepott, were delivered to Statoil ready for digitalised operations at Gullfaks and Oseberg.

 

International oil and gas – Deepen core areas and develop growth options

International oil and gas production represented approximately one third of Statoil’s equity production at 745 mboe per day in 2017. Statoil will continue to explore, develop, and produce oil and gas opportunities outside Norway as part of deepening its international core areas, the US onshore operations and Brazil, and developing future growth options.

 

Exploration: Statoil continues to explore internationally for oil and gas. Statoil participated in 11 exploration wells internationally, four of which were discoveries. Statoil added exploration acreage in Brazil, South Africa, UK, Suriname and the US Gulf of Mexico and entered one new country, Argentina.

Development: Statoil continued to strengthen its strategic partnership with Petrobras in Brazil, continuing construction on Peregrino Phase II and improving the project economics. Offshore UK, Mariner A has been installed and is currently in the hook-up and commissioning phase.

Production: Alongside operator BP and other partners, Statoil has signed the agreement for a licence  extension by 25 years until 2049 for Azeri-Chirag Guneshli (ACG) with the Azerbaijan government and SOCAR. Statoil and BP, with Sonatrach, also extended the In Amenas Production Sharing Contract (PSC) by five years, from 2022 to 2027.

Statoil completed its divestment from the Canadian oil sands.

 

In Brazil, a 25% share in the producing Roncador field was acquired. Statoil also strengthened its position in the BM-S-8 licence , which includes the Carcara discovery, by acquiring QGEP’s interest and successfully bidding on the open acreage to the North, before farming down to ExxonMobil and Petrogal.

 

In the United States, Statoil continued to focus on increasing and sustaining the profitability of existing assets in the portfolio, which led to continued progress towards the targets of lowering its US portfolio net operating income break-even to below USD 50 per barrel and increasing production by 50% from 2014 to 2018.

 

 

New energy solutions – Create a material new industrial position

 

Statoil’s ambition is to maintain its advantage as a leading company in carbon efficient oil and gas production while building a low-carbon business to capture new opportunities in the energy transition. Statoil continues to explore new business opportunities in offshore wind, solar, carbon capture and storage (CCS) as well as other potential new energy markets. Statoil expects 15-20% of its investments to be directed towards new energy solutions by 2030.

 

Develop opportunities: Progress continues on the Arkona offshore wind farm operated by partner E.On. Statoil continues to evaluate a potential Norwegian carbon and capture storage as well as the feasibility of natural gas-to-hydrogen projects. In the United States, Statoil continues to mature the New York Wind Energy Area lease as “Empire Wind”. 

 

Operate assets: In 2017, Statoil completed and opened the Dudgeon Offshore Wind Park. Hywind Scotland, the world’s first floating wind farm, also started production.

 

Statoil completed a re-organisation of the Dogger Bank consortium Forewind in the UK, splitting ownership of three of the four projects 50/50 with partner SSE and with Innogy (RWE) taking sole ownership of the remaining project. In December Statoil submitted a bid in the non-subsidy Dutch offshore wind tender for Hollanse Kust Zuid I & II. Statoil also initiated its first move into solar by acquiring 50% of the ongoing Apodi solar project in Brazil from Scatec Solar.

 

Midstream and marketing – Secure premium market access and grow value creation through cycles

The prime objective for Statoil’s mid- and downstream activities is to process and transport its oil and gas production (including the Norwegian State’s petroleum) competitively to premium markets, securing maximum value realisation. The main focus has been on:

 

·           Safe, secure and efficient operations

·           Minimising carbon emissions and intensity

·           Securing flow assurance and premium market access for Statoil’s equity production and the State’s Direct Financial Interest (SDFI) volumes

·           Building and maintaining resilience through asset backed trading, value chain positioning and counter-cyclical actions

·           Focus on regional piped gas value chains and pursue selective trading positions in LNG

In 2017, Statoil chartered the ultra-large crude carrier (ULCC) TI Europe as part of its asset backed trading strategy. Statoil decided to phase out the Mongstad combined heat and power by end 2018 and commissioned the Polarled pipeline. Statoil continued work towards integrating digital solutions into decision making, shipping activities, and energy trading.

 

Strategy enablers

 

Safe and secure operations: Safety and security is Statoil’s top priority. In 2017, Statoil initiated and continued several measures to reinforce safety work in all areas including continuous co-operation with partners and suppliers. The primary efforts launched in 2017 were focused on safety (I am Safety), security (2020 Security Roadmap), and IT security (New Information Technology Strategy) and are described in the chapter "Safeguarding people, the environment and assets: Safety and security.”

 

Technology, digitalisation and innovation: Statoil's technology strategy provides long-term guidance for technology development and implementation. In 2017, Statoil launched its digital roadmap and established its Digital Centre of Excellence and Digital Academy. Statoil, in partnership with Techstars, established an energy-focused accelerator in Oslo.

 

Empowered people: Statoil promotes a culture of collaboration, innovation and safety, guided by its values. Statoil has continued to develop its employees and attract talents to deliver on the future-fit portfolio ambition.

 

Stakeholder engagement: Statoil engages with stakeholders to secure industrial legitimacy, its social contract, trust and strategic support from stakeholders. This engagement extends to internal and external collaboration, partnerships, and other co-operation with suppliers, partners, governments, NGOs and communities in which Statoil operates.

 

Group outlook

Statoil’s plans address the current business environment while continuing to invest in high-quality projects. Statoil continues to reiterate its efforts and commitment to deliver on its priorities of high value creation, increased efficiency and competitive shareholder return.

 

·           Organic capital expenditures [4] for 2018 are estimated at around USD 11 billion

·           Statoil intends to continue to mature its large portfolio of exploration assets and estimates a total exploration activity level of around USD 1.5 billion for 2018, excluding signature bonuses

·           Statoil’s ambition is to keep the unit of production cost in the top quartile of its peer group

·           For the period 2017 – 2020, production growth is expected to be around 3-4% CAGR (Compound Annual Growth Rate)

·           Production for 2018 is estimated to be 1-2% above the 2017 level

·           Scheduled maintenance activity is estimated to reduce equity production by around 30 mboe per day for the full year of 2018

 

These forward-looking statements reflect current views about future events and are, by their nature, subject to significant risks and uncertainties because they relate to events and depend on circumstances that will occur in the future. Deferral of production to create future value, gas off-take, timing of new capacity coming on stream, operational regularity, activity level, development in the prices of goods, raw materials and services that are used in the development and operation of oil and gas producing assets, contractor performance, as well as uncertainty around the closing of the announced transactions represent the most significant risks related to the foregoing guidance. For further information, see section 5.7 Forward-Looking Statements.

 

  

 

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2.2 BUSINESS OVERVIEW

 

History

O n 18 September 1972 , Statoil was formed by a decision of the Norwegian parliament and incorporated as a limited liability company under the name Den norske stats oljeselskap AS. Being a company owned 100% by the Norwegian State, Statoil's initial role was to be the government's commercial instrument in the development of the oil and gas industry in Norway. Growing in parallel with the Norwegian oil and gas industry, Statoil’s operations have primarily been focused on exploration, development and production of oil and gas on the Norwegian continental shelf (NCS).

 

During the 1980s, Statoil grew substantially through the development of the NCS. Statoil also became a major player in the European gas market by entering into large sales contracts for the development and operation of gas transport systems and terminals. During the same decade, Statoil was involved in manufacturing and marketing in Scandinavia and established a comprehensive network of service stations. This line of business was fully divested in 2012.

 

In 2001, Statoil was listed on the Oslo and New York stock exchanges and became a public limited company under the name Statoil ASA, 67% majority owned by the Norwegian State. Since then, substantial investments both on the NCS and internationally, have grown our business. The merger with Hydro's oil and gas division on 1 October 2007 further strengthened Statoil’s ability to fully realise the potential of the NCS. Enhanced utilisation of expertise to design and manage operations in various environments have expanded our upstream activities outside our traditional area of offshore production. This includes the development of heavy oil and shale gas projects and projects that focus on other forms of energy, especially on offshore wind, but also on solar and carbon capture and storage.

 

The board of directors of Statoil have proposed to change the name of the company to Equinor. The new name supports the company’s strategy and development as a broad energy company.  The suggested name change will be proposed to the shareholders in a resolution to the annual general meeting on 15 May 2018.

 

Activities

Statoil is an international energy company primarily engaged in oil and gas exploration and production activities, organised under the laws of Norway and subject to the provisions of the Norwegian Public Limited Liability Companies Act. In addition to being the leading operator on the NCS, Statoil has also substantial international activities and is present in several of the most important oil and gas provinces in the world. Our activities span operations in more than 30 countries and employs 20,245 employees worldwide.

 

Our access to crude oil in the form of equity, governmental and third-party volumes makes Statoil a large seller of crude oil, a nd Statoil is the second-largest supplier of natural gas to the European market. Processing, refining, offshore wind and carbon capture and storage is also part of our operations.

 

Statoil’s registered office is at Forusbeen 50, 4035 Stavanger, Norway and the telephone number of its registered office is +47 51 99 00 00.

 

Our competitive position

Key factors affecting competition in the oil and gas industry are oil and gas supply and demand, exploration and production costs, global production levels, alternative fuels, and environmental and governmental regulations. When acquiring assets and licences for exploration, development and production and in refining, marketing and trading of crude oil, natural gas and related products, Statoil competes with other integrated oil and gas companies.

 

Statoil's ability to remain competitive will depend, among other things, on continuous focus on reducing costs and improving efficiency. It will also depend on technological innovation to maintain long-term growth in reserves and production, the ability to seize opportunities in new areas and utilise new opportunities for digitalisation.

 

The information about Statoil's competitive position in the strategic report is based on a number of sources; e.g. investment analyst reports, independent market studies, and our internal assessments of our market share based on publicly available information about the financial results and performance of market players.

 

Continuous improvements

Statoil focus on continuously efficiency improvements as a response to the industrial challenge that has emerged over the recent years characterised by reducing prices for our products and declining returns. More specifically, the ambition is to realise positive

production effects and capital expenditures and operating costs savings to improve financial results and cash-flows. In 2017, Statoil realised efficiency improvements of USD 1.3 billion on top of the already achieved USD 3.2 billon since 2013.

 

Establishment of Digital Centre of Excellence

In 2017 Statoil accelerated the digitalisation efforts by establishing a Digital Centre of Excellence and launching a digital road map. The goal is to significantly increase our utilisation of data, sophisticated analytics and robotics. In addition, Statoil aims to improve safety, reduce our carbon footprint and increase profitability. Statoil see potential by utilising data across IT applications and organisational boundaries. Combining data and learning across Statoil’s disciplines could provide a better basis for decision-making, new business opportunities, and increased collaboration externally with our partners, suppliers and other lines of business.

 

CORPORATE STRUCTURE

Business areas

Statoil's operations are managed through the following eight business areas:

 

Development & Production Norway (DPN)

DPN manages Statoil’s upstream activities on the NCS and explores for and extracts crude oil, natural gas and natural gas liquids. The business area’s ambition is to continue Statoil’s leading position on the NCS and ensure maximum value creation through continuously improved HSE and operational performance.

 

Development & Production International (DPI)

DPI manages Statoil’s worldwide upstream activities excluding the DPN and Development & Production USA (DPUSA) business areas. It explores for and extracts crude oil, natural gas and natural gas liquids. DPI's ambition is to build a large and profitable international production portfolio comprising activities ranging from accessing new opportunities to delivering on profitable projects in a range of complex environments.

 

Development & Production USA (DPUSA)

DPUSA manages Statoil’s upstream activities in the USA and Mexico. DPUSA's ambition is to develop a material and profitable position in the US and Mexico, including the deep-water regions of the Gulf of Mexico and unconventional oil and gas in the US.

 

Marketing, Midstream & Processing (MMP)

MMP manages Statoil’s marketing and trading activities related to oil products and natural gas, transportation, processing and manufacturing, and the development of oil and gas. MMP seeks to maximise value creation in Statoil's midstream and marketing business.

 

Technology, Projects & Drilling (TPD)

TPD is responsible for the global project portfolio, well delivery, new technologies and sourcing across Statoil. TPD seeks to provide safe and secure, efficient and cost-competitive global well and project delivery, technological excellence, and research and development. Cost-competitive procurement is an important contributory factor for maximising value for Statoil.

 

Exploration (EXP)

EXP manages Statoil’s worldwide exploration activities with the aim of positioning Statoil as one of the leading global exploration companies. This is achieved through accessing high potential new acreage in priority basins, globally prioritising and drilling more significant wells in growth and frontier basins, delivering near-field exploration on the NCS and other select areas, and achieving step-change improvements in performance.

 

New Energy Solutions (NES)

NES reflects Statoil’s  long-term goal to complement our oil and gas portfolio with profitable renewable energy and other low-carbon energy solutions. NES is responsible for wind farms and carbon capture and storage as well as other renewable energy and low-carbon energy solutions.

 

Global Strategy & Business Development (GSB)

GSB develops the corporate strategy and manages business development and merger and acquisition activities for Statoil. The ambition of the GSB business area is to closely link corporate strategy, business development and merger and acquisition activities to actively drive Statoil's corporate development.

Reporting segments

With effect as of the third quarter 2017, segment names have been changed for the reporting segments DPN and DPI. New names are Exploration & Production Norway (E&P Norway) and Exploration & Production International (E&P International), respectively. There are no changes to other reporting segments, and business area’s names remain unchanged.

 

Statoil reports its business in the following reporting segments:

·           E&P Norway reporting segment – Exploration & Production Norway – the DPN business area

·           E&P International reporting segment – Exploration & Production International , which combines the DPI and the DPUSA business areas

·           MMP reporting segment - Marketing, Midstream & Processing – the MMP business area

·           Other – which includes activities in NES, TPD, GSB and Corporate and support functions

 

Activities relating to the EXP business area are fully allocated to - and presented in - the relevant exploration and production reporting segment. Activities relating to the TPD and GSB business areas are partly allocated to - and presented in - the relevant exploration and production reporting segments.

Presentation

In the following sections in the report, the operations are reported according to the reporting segment. Underlying activities or business clusters are presented according to how the reporting segment organises its operations. See note 3 Segments  to the Consolidated financial statements for further details.

 

As required by the SEC, Statoil prepares its disclosures about oil and gas reserves and certain other supplementary oil and gas disclosures based on geographic areas. Statoil’s geographical areas are defined by country and continent and consist of Norway, Eurasia excluding Norway, Africa, US and Americas excluding US.

 

SEGMENT REPORTING

Internal transactions in oil and gas volumes occur between our reporting segments before being sold in the market. The pricing policy for internal transfers is based on estimated market prices. For further information, see section 2.8 Operational performance under Production volumes and prices.

 

We eliminate intercompany sales when combining the results of reporting segments. Intercompany sales include transactions recorded in connection with our oil and natural gas production in the E&P Norway and the E&P International reporting segments, and also in connection with the sale, transportation or refining of our oil and natural gas production in the MMP reporting segment. Certain types of transportation costs are reported in both the MMP and the DPUSA business areas.

 

The DPN business area produces oil and natural gas which is sold internally to the MMP business area. A large share of the oil produced by the DPI and DPUSA business areas is also sold through the MMP business area. The remaining oil and gas from the DPI and the DPUSA business areas is sold directly in the market. For intercompany sales and purchases, Statoil has established a market-based transfer pricing methodology for the oil and natural gas that meets the requirements for applicable laws and regulations.

 

In 2017, the average transfer price for natural gas was USD 4.33 per mmbtu. The average transfer price was USD 3.42 per mmbtu in 2016 and USD 5.17 in 2015. For oil sold from DPN to MMP, the transfer price is the applicable market-reflective price minus a cost recovery rate.

The following table shows certain financial information for the four reporting segments, including intercompany eliminations for each of the years in the three-year period ending 31 December 2017. For additional information, see note 3 Segments to the Consolidated financial statements.

 

The following tables show total revenues by country.

 

 

2016 Total revenues and other income by country	Crude oil	Natural gas	Natural gas liquids	Refined products	Other	Total sales
(in USD million)
Norway	20,544	7,973	3,580	4,135	(497)	35,735
US	3,073	957	455	1,110	867	6,463
Sweden	0	0	0	1,379	(53)	1,326
Denmark	0	0	0	1,518	14	1,532
Other	690	272	1	0	(26)	936
Total revenues (excluding net income (loss) from equity accounted investments and other income	24,307	9,202	4,036	8,142	305	45,993

 

2015 Total revenues and other income by country	Crude oil	Natural gas	Natural gas liquids	Refined products	Other	Total sales
(in USD million)
Norway	22,741	10,811	4,932	5,644	1,454	45,582
US	3,718	1,133	532	1,605	933	7,922
Sweden	0	0	0	1,762	115	1,877
Denmark	0	0	0	1,750	8	1,759
Other	1,347	446	17	0	722	2,532
Total revenues (excluding net income (loss) from equity accounted investments and other income	27,806	12,390	5,482	10,761	3,232	59,671

RESEARCH AND DEVELOPMENT

Statoil is a technology-intensive company and research and development is an integral part of our strategy. Our technology strategy is about prioritising technology for value creation that enables us to achieve growth and access, and sets the direction for technology development and implementation for the future. Our focus is on low cost, low carbon solutions and re-using standardised technologies.

 

We continuously research, develop and deploy innovative technologies to create opportunities and enhance the value of Statoil’s current and future assets. Statoil’s technology development activities aim to reduce field development, drilling and operating costs, and CO ₂ and other greenhouse gas emissions. We utilise a range of tools for the development of new technologies:

 

·           In-house research and development

·           Cooperation with academia and research institutes

·           Collaborative development projects with our major suppliers

·           Project related development as part of our field development activities

·           Direct investment in technology start-up companies through our Statoil Technology Invest venture activities

·           Invitation to open innovation challenges as part of  Statoil Innovate

 

Research and development expenditures were USD 307 million in 2017, USD 298 million in 2016 and USD 344 million in 2015,

2.3 E&P Norway
– exploration & production NORWAY

 

OVERVIEW

The Exploration & Production Norway (E&P Norway) reporting segment is responsible for exploration, field development and operations on the NCS which includes the North Sea, the Norwegian Sea and the Barents Sea. E&P Norway aims to ensure safe and efficient operations and to maximise the value potential from the NCS. For proved reserves development see Development of reserves in Proved oil and gas reserves in section 2.8 Operational performance.

 

For 2017, E&P Norway reports NCS production from 38 Statoil operated fields, 10 partner operated fields, and equity accounted production from Lundin Petroleum AB.

 

 

Statoil, Annual Report on Form 20-F 2017      21

 

 

Key events and portfolio developments in 2017:

·           In March, the decision was made to proceed with the Johan Sverdrup phase 2 development, awarding FEED contracts. Investment decision and submission of Plan for Development and Operation is expected in the second half of 2018

·           On 26 March, the Flyndre field came on stream with Maersk Oil UK Ltd as operator

·           On 27 March, Statoil submitted the revised Plan for Development and Operation for the Njord field, and Plan for Development and Operation for the Bauge field. Both submitted plans were subsequently approved on 20 June 2017

·           On 15 April, the Norwegian authorities approved the Plan for Development and Operation of the Trestakk discovery on the Halten Bank in the Norwegian Sea

·           On 30 June, the Gina Krog field went on stream

·           On 1 July, Statoil assumed operatorship of the Sigyn field in the North Sea

·           In July, Statoil and partners decided to develop the Snefrid Nord gas discovery. The field will be tied back to Aasta Hansteen

·           On 28 July, the Byrding field came on stream

·           In September, Statoil achieved NCS climate target two years ahead of schedule

·           In October, Barents drilling campaign concludes with the Kayak find of commercial size

·           In November, opening of the Valemon control room, the first platform in Statoil’s portfolio remotely-controlled from land

·           On 27 November, Statoil announced the decision to buy Total’s equity stakes and to assume the operatorships of the Martin Linge field and the Garantiana discovery. The transactions are expected to be finalised in late March 2018

·           On 5 December, Statoil submitted the Plan for Development and Operation for the Johan Castberg field in the Barents Sea

·           In December, Cat J rigs Askeladden and Askepott preparing arrival at the Gullfaks and Oseberg fields. Drilling is expected to start in early 2018

·           On 21 December, Statoil submitted the Plan for Development and Operation of the Snorre Expansion project, increasing the recovery from the Snorre field by close to 200 million barrels

  

 

Fields in production on the NCS

The table below shows E&P Norway's average daily entitlement production for the years ending 31 December 2017, 2016 and 2015. Production in 2017 increased due to higher flex gas off-take, contributions from new fields and fewer turnarounds.

 

Average daily entitlement production	For the year ended 31 December
	2017				2016				2015
	Oil and NGL	Natural gas			Oil and NGL	Natural gas			Oil and NGL	Natural gas
Area production	mbbl/day	mmcm/day	mboe/day		mbbl/day	mmcm/day	mboe/day		mbbl/day	mmcm/day	mboe/day
Statoil operated fields	505	100	1,136		511	86	1,049		545	88	1,100
Partner operated fields	70	17	179		70	17	177		50	13	132
Equity accounted production	19	-	19		8	-	8		-	-	-
Total	594	118	1,334		589	103	1,235		595	101	1,232

The following tables show the NCS entitlement production by fields in which Statoil was participating during the year ended 31 December 2017.

 

Average daily entitlement production	Geographical area	Statoil's equity interest in %		On stream	Licence expiry date		Average production in 2017 mboe/day
Field
Statoil operated fields
Troll Phase 1 (Gas)	The North Sea	30.58		1996	2030		200
Oseberg	The North Sea	49.30		1988	2031		101
Gullfaks	The North Sea	51.00		1986	2036		96
Åsgard	The Norwegian Sea	34.57		1999	2027		93
Visund	The North Sea	53.20		1999	2034		67
Kvitebjørn	The North Sea	39.55		2004	2031		54
Tyrihans	The Norwegian Sea	58.84		2009	2029		54
Grane	The North Sea	36.61		2003	2030		47
Snøhvit	The Barents Sea	36.79		2007	2035		44
Troll Phase 2 (Oil)	The North Sea	30.58		1995	2030		39
Sleipner Vest	The North Sea	58.35		1996	2028		39
Statfjord Unit	The North Sea	44.34		1979	2026		38
Gudrun	The North Sea	36.00		2014	2028		35
Snorre	The North Sea	33.28		1992	2018	1)	28
Valemon	The North Sea	53.78		2015	2031		26
Mikkel	The Norwegian Sea	43.97		2003	2024		21
Fram	The North Sea	45.00		2003	2024		20
Kristin	The Norwegian Sea	55.30		2005	2033	2)	19
Alve	The Norwegian Sea	85.00		2009	2029		17
Gina Krog	The North Sea	58.70		2017	2032		15
Urd	The Norwegian Sea	63.95		2005	2026		12
Heidrun	The Norwegian Sea	13.04		1995	2024	3)	11
Vigdis area	The North Sea	41.50		1997	2024		10
Sleipner Øst	The North Sea	59.60		1993	2028		9
Tordis area	The North Sea	41.50		1994	2024		9
Morvin	The Norwegian Sea	64.00		2010	2027		8
Sigyn	The North Sea	60.00		2002	2022	4)	6
Norne	The Norwegian Sea	39.10		1997	2026		5
Gungne	The North Sea	62.00		1996	2028		4
Statfjord Nord	The North Sea	21.88		1995	2026		2
Heimdal	The North Sea	29.44		1985	2021		2
Veslefrikk	The North Sea	18.00		1989	2020	5)	2
Byrding	The North Sea	70.00		2017	2024		2
Statfjord Øst	The North Sea	31.69		1994	2026	6)	1
Sygna	The North Sea	30.71		2000	2026	7)	1
Fram H Nord	The North Sea	49.20		2014	2024	8)	0
Gimle	The North Sea	65.13		2006	2034	9)	0
Sindre	The North Sea	52.34		2017	2023		0
Total Statoil operated fields							1,136

Statoil, Annual Report on Form 20-F 2017      23

 

1)  PL089 expires in 2024 and PL057 expires in 2018.

2)  PL134D expires in 2027 and PL199 expires in 2033.

3)  PL095 expires in 2024 and PL124 expires in 2025.

4)  Transfer of operatorship from ExxonMobil to Statoil on 1 July 2017.

5)  PL052 expires in 2020 and PL053 in 2031.

6)  PL037 expires in 2026 and PL089 expires in 2024.

7)  PL037 expires in 2026 and PL089 expires in 2024.

8)  PL090G expires in 2024 and PL248E expires in 2035.

9)  PL120B expires in 2034 and PL050DS expires in 2023.

10)  PL209/250 expires in 2041 and PL208 expires in 2040.

11)  PL212/262 expires in 2033 and PL159 expires in 2029.

12)  PL001B, PL457BS and PL242 expire in 2036. PL 338BS expire in 2029.

 

  

Main producing fields on
the NCS

Statoil operated fields

Troll is the largest gas field on the NCS and a major oil field. The Troll field regions are connected to the Troll A, B and C platforms. Troll gas is mainly exported and produced at Troll A, while oil is mainly produced at Troll B and C. Fram, Fram H Nord and Byrding are tie-ins to Troll C.

 

The Oseberg area includes the Oseberg Field Centre, Oseberg C, Oseberg East and Oseberg South production platforms. Oil and gas from the satellites are transported to the Oseberg Field Centre for processing and transportation.

Gullfaks was developed with three platforms. Since production started on Gullfaks in 1986, several satellite fields have been developed with subsea wells that are remotely controlled from the Gullfaks A and C platforms.

 

The Åsgard field includes the Åsgard A production and storage ship for oil, the Åsgard B semi-submersible floating production platform for gas and condensate, and the Åsgard C storage vessel for oil and condensate. Åsgard C is also storage for oil produced at Kristin and Tyrihans. In 2015 Statoil started the world first subsea gas compressor train on Åsgard, and the second train was started in February 2016. Mikkel and Morvin are tie-ins to Åsgard. The Trestakk development will be a tie-in to Åsgard A with production start planned for 2019.

 

Visund is an oil and gas field that includes a floating drilling, production and living quarter unit and two subsea templates.

 

Kvitebjørn is a gas and condensate field developed with an integrated accommodation, drilling and processing facility with a steel jacket.

 

Partner-operated fields

Ormen Lange operated by A/S Norske Shell, is a deepwater gas field in the Norwegian Sea. The well stream is transported to an onshore processing and export plant at Nyhamna. Gassco AS became operator of Nyhamna JV from 1 October 2017, with Shell as technical service provider.

 

Skarv is an oil and gas field located in the Norwegian Sea, with Aker BP ASA as operator. The field development includes a floating production, storage and offloading vessel (FPSO) and five subsea multi-well installations.

 

Ivar Aasen   is operated by Aker BP ASA. It is an oil and gas field located in the North Sea. The development includes a fixed steel jacket with partial processing and living quarters tied in as a satellite to Edvard Grieg for further processing and export.

 

Goliat   is operated by Eni Norge AS. It is the first oil field developed in the Barents Sea. The field consists of subsea wells tied back to a circular floating production, storage and offloading vessel (FPSO). The oil is offloaded to shuttle tankers.

 

Ekofisk is operated by ConocoPhillips Skandinavia AS. It consists of the Ekofisk, Tor, Eldfisk and Embla fields.  

 

Marulk is operated by Eni Norge AS. It is a gas- and condensate field developed as a tie-back to the Norne FPSO.

 

Exploration on the NCS

Statoil holds exploration acreage and actively explores for new resources in all three regions on the NCS, the Norwegian Sea, the North Sea and the Barents Sea.

Statoil was awarded 31 licences (17 as operator) in the Awards for Predefined Areas (APA) round 2017 for mature areas and completed several farm-in transactions with other companies.

Throughout 2017, as part of the industry initiative Barents Sea Exploration Collaboration (BaSEC), Statoil and its partners have drilled 6 wells in the Barents Sea and are planning to continue drilling wells in the area also in 2018.

In 2017 Statoil and its partners completed 17 exploratory wells and made 10 commercial and 3 non-commercial discoveries in Norway. In 2018 Statoil expects to complete 25-30 exploration wells on the NCS, with exploration near existing infrastructure to be the core of the activity plan.

 

 

 

 

  

 

 

Fields under development on the NCS

Statoil’s major development projects on the NCS as of 31 December 2017:

 

Oseberg Vestflanken 2 (Statoil 49.3%, operator) is the development of the oil and gas structures Alfa, Gamma and Kappa. The well stream will be routed to the Oseberg field centre through a new pipeline. The discoveries will be developed using an unmanned wellhead platform. Production is expected to start in mid-2018.

 

Aasta Hansteen   (Statoil 51%, operator) is a deep-water gas discovery in the Norwegian Sea. The field development includes three subsea templates tied in to a floating processing unit with gas export through a new pipeline, Polarled, to Nyhamna and further export through the Langeled pipeline. The Aasta Hansteen processing unit can also serve as a hub for other potential discoveries in the area. On 11 November 2017, the drilling of the first well of the Aasta Hansteen field development commenced. The topside and substructure were integrated in December 2017 in Norway. Production is expected to start in second half of 2018.

 

Johan Sverdrup (Statoil 40.03%, operator, with additional 4.54% indirect interest held through Lundin)   is an oil discovery in the North Sea. Phase 1 of the development will consist of 35 production and water injection wells and a field centre with four platforms: A living quarter platform, a wellhead platform with permanent drilling facility, a processing platform and a riser and utility platform. Crude oil will be exported to Mongstad through a 274 km designated pipeline, and gas will be exported to the gas processing facility at Kårstø through a 156 km pipeline via a subsea connection to the Statpipe pipeline. As at the end of 2017, eight production wells and nine water injection wells have been drilled. Production is expected to start late fourth quarter 2019.

 

Utgard (Statoil 38.44% interest in the Norwegian and 38% in the UK sector, operator) is a gas and condensate discovery in the North Sea. The development includes two wells in a standard subsea concept, with one drilling target on each side of the UK-Norwegian maritime border . Gas and condensate will be piped through a new pipeline to the Sleipner field for processing and further transportation to market.  In January 2017, the Plan for Development and Operation and the field development plan were approved by the Norwegian and UK authorities. Production is expected to start in fourth quarter 2019.

 

Trestakk (Statoil 59.1%, operator) is an oil discovery with associated gas on Haltenbanken. It will be developed as a subsea tie-back to Åsgard A, comprising one subsea template and one satellite with three producers and two injectors. In March 2017, the Plan for Development and Operation was approved by the Norwegian authorities. Production is expected to start in 2019.

 

Martin Linge (Statoil 19%, and upon consummation of the acquisition from Total, 70%) is an oil and gas field operated by Total, near the British sector of the North Sea. The reservoir is complex with gas under high pressure and high temperatures. In late November 2017, Statoil and Total announced that Statoil will purchase Total’s interest (51%) and assume the operatorship of Martin Linge, with an effective date, upon consummation, of January 1, 2018. The transaction is subject to certain conditions and is expected to close in late March 2018. The development includes a fixed steel jacket platform with processing and export facilities, with electric power to be supplied from Kollsnes. Total, the current operator, expects production to start in 2019.

 

Njord future (Statoil 20%, operator) is a development to enable safe, reliable and efficient exploitation of the Njord and Hyme oil discoveries through to 2040. The development comprises an upgrade of the Njord A platform, an optimal oil export solution and drilling of 10 new wells. The Plan for Development and Operation was approved on 20 June 2017. Production is expected to start in late 2020.

 

Snorre expansion (Statoil 33.28%, operator) is a development to produce the remaining commercial oil reserves on the Snorre field. T he Plan for Development and Operation of the field was submitted to the Norwegian authorities on 21 December 2017 . The concept consists of six subsea templates, with four well slots each. Each slot will have the possibility for either production or injection. 24 wells will be drilled, 12 production wells and 12 injection wells. Production is expected to start in 2021.

 

Johan Castberg (Statoil 50%, operator) is the development of the three oil discoveries Skrugard, Havis and Drivis, located some 140 kilometres northwest of Hammerfest. The development includes a production vessel and a subsea development with 30 wells, ten subsea templates and two satellite structures. The Plan for Development and Operation of the field was submitted to the Norwegian authorities on 5 December 2017. Production is expected to start in 2022.

 

Decommissioning on the NCS

Under the Petroleum Act, the Norwegian government has imposed strict procedures for removal and disposal of offshore oil and gas installations. The Convention for the Protection of the Marine Environment of the Northeast Atlantic (OSPAR) stipulates similar procedures.

 

Huldra ceased production in September 2014, after 13 years in production. The permanent plugging and abandonment of wells was finalised in 2017, and removal of platform is planned for in 2019.

 

Volve ceased production in September 2016, after more than eight years in production. The permanent plugging of wells was finalised during 2016, and the removal of subsea facilities is expected to be completed in 2018.

 

During 2017, there were permanent plugging and abandonment operations at Statfjord, Heidrun, Veslefrikk, Troll, Åsgard, Njord, Visund, Skuld and Tune. The partner-operated fields Ekofisk and Ormen Lange also had ongoing plugging and abandonment activities.

 

For further information about decommissioning, see note 2 Significant accounting policies to the Consolidated financial statements.

 

2.4 E&P International – exploration & PRODUCTION INTERNATIONAL

 

E&P International overview

Statoil is present in several of the most important oil and gas provinces in the world. Exploration & Production International (E&P International) reporting segment covers development and production of oil and gas outside the Norwegian continental shelf (NCS).

 

E&P International is present in nearly 30 countries and had production in 12 countries in 2017 . E&P International produced 36% of Statoil's total equity production of oil and gas in 2017 . For information about proved reserves development see section 2.8 Operational performance under Proved oil and gas reserves.

 

The map shows the countries where E&P International has activity.

Key events and portfolio developments in 2017 and early 2018:

28   Statoil, Annual Report on Form 20-F 2017    

·          In January 2017, the plan for development and operation for the Utgard field was approved by the Norwegian and UK authorities. The Utgard field spans the UK-Norway maritime border. For more information, see Fields under development on the NCS in section 2.3 E&P Norway

·          In February, the In Amenas Gas Compression project in Algeria came into operation

·          On 31 January, the transaction to divest Statoil’s 100% owned Kai Kos Dehseh (KKD) oil sands projects in the Canadian province of Alberta to Athabasca Oil Corporation (AOC) was completed. The transaction covers the producing Leismer asset and the undeveloped Corner project, along with a number of contracts associated with Leismer’s production. Following this transaction, Statoil no longer owns or operates any oil sands assets. As part of the transaction, Statoil will own just below 20% of AOC’s shares, and this will be managed as a financial investment.  For more information about the transaction see note 4 Acquisitions and divestments to the Consolidated financial statements

·           In March, Statoil was awarded 13 leases in US Gulf of Mexico

·          In March, Statoil was awarded six new licences, five as operator, in the 29th Offshore Licensing Round in UK

·           In April, Statoil acquired an additional 14% working interest in existing Statoil-operated unconventional onshore assets in the Appalachian  region from Northwood Energy Corporation.

·           In April, the Vito (Statoil 37%, Shell operator) offshore discovery received approval for its concept development and selection

·          In May, the Stampede (Statoil 25%, Hess operator) asset’s offshore platform was successfully installed; and subsea work was completed and all three wells were ready at year end 2017. Production commenced with first oil in January 2018.

·          In June, Statoil signed a swap agreement with BP regarding exploration permits in the Great Australian Bight and became operator and 100% equity interest holder in exploration permits EPP39 and EPP40 while Statoils equity interest in EPP37 and EPP38 were transferred to BP

·          In July, Statoil and Queiroz Galvão Exploração e Produção (QGEP) signed an agreement for Statoil to acquire QGEP’s 10% interest in the Statoil operated BM-S-8 licence in Brazil, thereby increasing Statoil’s interest in the licence to 76%. The transaction was completed in December.   For more information about the transaction see note 4 Acquisitions and divestments to the Consolidated financial statements  

·          In September, Statoil completed transactions in South Africa for exploration rights, one with ExxonMobil Exploration and Production South Africa acquiring an interest in Transkei Algoa and one with OK Energy Ltd. to acquire interest and operatorship in East Algoa. 

·          In October, Statoil, as part of a consortium with ExxonMobil and Galp, presented the winning bid for the   Carcará North block in the Santos basin in Brazil. The award closed in December 2017. Statoil is the operator and has 40% interest. 
In addition, Statoil, ExxonMobil and Galp have agreed on subsequent transactions in the adjacent BM-S-8 block to align equity interests across the two blocks that together comprise the Carcará oil discovery. Upon consummation and subject to government approval, Statoil will have a 36.5% interest in BM-S-8 and a 40% interest in Carcará North and will be the operator of the unitised Carcará field development .   For more information about the transactions see note 4 Acquisitions and divestments to the Consolidated financial statements

·          Statoil and the international partners in the ACG licence (Azeri-Chirag-Gunashli fields) in Azerbaijan have secured an extension of oil production of 25 years from 2024 under an extended and amended PSA, which was ratified by the Azeri Parliament on 31 October. As part of the agreement, Statoil's interest in the field has been adjusted from 8.56% to 7.27%, effective from 1 January 2017

·          On 27 November, the Hebron oil field (Statoil 9%, ExxonMobil operator) offshore Canada started production

·          In December, Statoil and Petrobras signed an agreement that Statoil will acquire a 25% interest in Roncador , a producing oil field in the Campos Basin in Brazil. Petrobras retains operatorship and a 75% interest. The field produced around 280 mboe per day in 2017. The effective date for the Roncador transaction is 1 January 2018. Closing is subject to government approval. For more information about the transactions see note 4 Acquisitions and divestments to the Consolidated financial statements

·          In December, Statoil and the other partners BP and Sonatrach in the In Amenas licence in Algeria secured a licence extension of 5 years from 2022 through an amended and restated Production Sharing Agreement (PSA). Closing is subject to government approval  

 

INTERNATIONAL PRODUCTION

Entitlement production volumes are Statoil’s share of the volumes distributed to the partners according to production sharing agreement (PSA) ( see section 5.6   Terms and abbreviations ). For US assets entitlement production is expressed net of royalty interests. For all other countries royalties paid in-cash are included in entitlement production and royalties payable in-kind are excluded.
Equity production represent volumes that correspond to Statoil’s percentage ownership in a particular field and is larger than Statoil’s entitlement production if the field is governed by a PSA.

 

Statoil's equity production outside Norway was 36% of Statoil's total equity production of oil and gas in 2017. Statoil's entitlement production outside Norway was about 31% of Statoil's total entitlement production in 2017.

 

The following table shows E&P International's average daily entitlement production of liquids and natural gas for the years ending 31 December 2017, 2016 and 2015 .  

 

Statoil, Annual Report on Form 20-F 2017      29

The table below provides information about the fields that contributed to production in 2017. Equity production per field is included in this table.