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Norway could get economic lift from northern oil field

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June 26 (UPI) — Norwegian energy company Statoil said Monday it expected some economic spillovers would come from support centers for its Johan Castberg field.

The company said the northern port city of Hammerfest, located in Finnmark county, would serve as supply and helicopter base for the development of the Johan Castberg field. Statoil said it aims to invest around $135 million per year on the field, which it said would equate to about 1,700 man years, a unit of the work done by one person in a year.

“We will seek to recruit as many as possible from Finnmark to the offshore organization,” Siri Espedal Kindem, a regional vice president for Statoil, said in a statement. “We have therefore contacted the county administration and schools to launch an initiative to ensure good recruitment to the studies that will meet our offshore competence requirements.”

The government in April said employment declines were apparent in the capital goods sector, “which are particularly affected by the reduced investment activity in the oil and gas sector.” Overall, the government reported industrial confidence had moved into positive territory for the first time since the third quarter of 2014, but remains below a historical average.

In March, the country’s central bank left its key rate unchanged at 0.5 percent. In a statement of justification, the bank said inflation would be lower than it expected, which implies the Norwegian economy is becoming isolated.

Norway is a main oil and natural gas supplier for the European economy, designating nearly all of its offshore production for exports. The Norwegian Petroleum Directorate, the nation’s energy regulator, said preliminary figures for May were lower than the previous month, but better than expected.

Statoil said it aims to make a final investment decision on Johan Castberg, located in the Barents Sea, by the end of the year. Hailed as one of the largest in the company’s portfolio that’s yet to be developed, the field has estimated proven reserves of between 400 million and 600 million barrels of oil.

Tags: johan castberg field, norwegian petroleum directorate, energy company statoil, siri espedal kindem, capital goods sector