SDFI and Petoro annual report 2021
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Introduction to the enterprise

Melkøya, Hammerfest Photo: Einar Aslaksen / Equinor

Petoro AS

Petoro manages the State’s Direct Financial Interest (SDFI). The company’s principal objective is to generate the highest possible financial value from the SDFI portfolio. At year-end, the company had 70 employees. 
organisasjonskart2021_eng
Ministry of Trade, Industry and Fisheries, in the person of the minister, represents the government as sole owner and serves as the company’s general meeting and highest authority. The Board has overall responsibility for administration of the company. Petoro’s organisation is shown in the figure below.

*as of 1 January 2022, the former Licence Follow-up and Commercial is distributed between Licence and Technology and Market and Commercial

Key figures for Petoro AS

202120202019
Total allocation/ administration grant (NOK million)*285288287
Employees at 31 December706465
Full-time equivalents (average number of full-time equivalents employed)65.962.862.9
Payroll share of administration grant (per cent)**41 37 37
Payroll costs per full-time equivalent (NOK million)**1.771.711.71
Percentage of consultants in administration contribution (per cent)181920
ICT expenses (NOK million)313035
Office lease expenses incl. overhead costs11.110.710.8
*   excluding VAT
** Payroll in Note 3 excl. provision for agreed severance pay
 

The State’s Direct Financial Interest (SDFI)

The SDFI scheme was established in 1985. Under this arrangement, the state participates as a direct investor in petroleum activities on the Norwegian continental shelf (NCS), so that the state receives revenues and meets expenses associated with SDFI’s ownership interests. Petoro acts as licensee for the state’s ownership interests in production licences, fields, pipelines and onshore facilities, and manages this portfolio based on sound business principles. At the end of 2021, the portfolio consisted of 184 production licences, 37 producing fields and 16 pipelines and terminals, as well as follow-up of 12 production licences with net profit agreements. 

The SDFI portfolio represents about one-third of Norway’s overall oil and gas reserves and yielded a cash flow of NOK 186 billion in 2021.

Key figures for SDFI

202120202019
Net cash flow (in NOK million)186,05858,71196,184
Operating revenue (NOK million) (NGAAP)286,141108,940153,395
Production expenses (million NOK) (NGAAP)17,71114,07413,690
Net income for the year (in NOK million) (NGAAP)222,13547,75495,647
Investment (in NOK million) (capital accounts)24,73227,60126,331
Production — oil and NGL (thousand bbl/d)388374349
Production - dry gas (million scm/d)1019898
Production - total (thousand boe/d)1,026988964
Remaining reserves (million boe)4,9725,0455,335
Reserve replacement rate (annual percentage)802040
Reserves added (million boe)30172142
Oil price (USD/bbl)704065
Oil price (NOK/bbl)603376572
Gas price (NOK/scm)4.781.251.92