Norway Embarks on a Major Step in Lofoten Islands Oil and Gas Exploration

Norway has embarked on an important step towards oil and gas exploration in an environmentally fragile part of the Arctic.

Oil exploration in the area surrounding the Lofoten Islands, located slightly above the Arctic, is becoming one of the highly controversial topics for the upcoming parliamentary elections. However, the leading Labor Party recently gave a go signal for an impact study.

The scenic area had not been opened for any development since it is a habitat to the richest cod supplies in the world, and the tourism industry and environmental groups have always tried to protect it by opposing any activity there.

The Labor Party ruled for the study to be conducted as a prerequisite to any oil exploration. However, it would still require another vote in the years to come before any oil drilling can be started.

Oil is the lifeblood of Norway’s economy, and the country is the seventh largest exporter of oil in the world as well as the largest supplier of gas in Europe.

Its extensive offshore energy division continuously requires new exploration to stop production declines, and energy companies have disputed that they should be permitted to explore the Lofoten Islands.

The oil output of Norway will drop to its lowest in 25 years this 2013 as the fields of the North Sea mature and, even huge recent discoveries, such as the Johan Sverdup which may hold more than 3 billion oil barrels, will only delay the fall.

Lofoten’s waters are estimated to contain 8 percent of the undiscovered gas and oil resources in Norway, with seismic examinations recognizing 50 prospects that may have recoverable deposits equivalent to about 1.27 billion oil barrels, according to the earlier estimate of the petroleum directorate.

With the support of Labor, the top three parties of Norway currently favor oil exploration in the regions, increasing the possibility that the upcoming government will start the process.