Statoil – the Norwegian powerhouse

Norwegian oil

Statoil is one of the world’s biggest oil producers. A major contributor to the wealth of the tiny nation, it is worth considering a closer look at this massive petroleum play.

Headquartered in Stavanger, the centre of the oil industry in Norway, the oil giant is one of the world’s best-known oil producers.

Despite the recent downturn the company employs over 20,000 people, and is what is known as a NOC or a national oil company as the government of Norway is the biggest shareholder. It is also listed on the Oslo stock exchange, with a value of 457 billion Norwegian Kroner (£39 billion).

Shares in the company have suffered of late as a result of the oil price slump, falling by almost 33 per cent last year from 180 Kroner to 120 Kroner.

In addition to its major shareholder the Norwegian government which holds 67 per cent and the Norwegian national insurance fund which holds 3.1 per cent, there is a ‘long tail’ of shareholders that include a mixture of Nordic and US institutions such as State Street and Swedish giant SEB.

The world’s eleventh largest producer is led by CEO Eldar Sætr, who has worked at the company for over thirty years.

Other members of the board include Bjorn Tore Global, a former member of the Norwegian parliament who previously served as the minister for defence.

International experience on the board comes in the form of non-executive director James Mulva, an American citizen and the former CEO of oil giant ConocoPhillips. There is also Catherine Hughes, a Canadian citizen who worked in the oil fields of Alberta for several years.

Statoil is part of the key to Norway’s incredible wealth, and its plan to take a long-term view of its economy. Unlike the USA or UK being a state-owned company gives the government a much greater say in Statoil’s affairs and also means that citizens benefit – albeit indirectly – from major oil finds.

The recent oil price slump will now doubt place further pressure on the giant but should nonetheless also give it a greater impetus to invest in cost-cutting oil technology.

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