Competitive concern

October 4, 2002, 15:30 CEST

Concern has been expressed by Statoil over the possibility that Norway’s offshore supplies sector is losing ground to its international competitors.

This was the main message in a speech by Henrik Carlsen, executive vice president for Exploration & Production Norway, at a meeting for Statoil suppliers on 3 October.

“We want the most competitive possible tendering process when awarding contracts, because that ensures cost-efficiency in Norwegian industry and Norway’s offshore developments,” he said.

Where possible, Statoil’s contract philosophy seeks to put together packages which ensure the highest level of competition. This also gives Norwegian suppliers a chance to bid.

“We’re seeing a trend where it appears to be difficult for fabricators in Norway to out-compete international industry,” Mr Carlsen said.

"The present position is disquieting for competition and for Norway's supplies industry."

He based his concern on contracts put out to tender by Statoil recently.

About 160 suppliers participated in the meeting, which was staged for the seventh time at Statoil’s head office in Stavanger.

This annual event aims to keep the supplies industry informed about the group’s future plans and requirements.

The emphasis this year was on its technology requirements and the challenges presented by continued development of the Norwegian continental shelf (NCS).

“We’ll have a number of NCS fields where technological advances are needed to improve recovery,” says Odd Instefjord. “And deepwater technology is in demand in a number of areas internationally.”

A process owner in Statoil’s procurement and supply unit, he was responsible for organising the meeting.

The group placed orders worth NOK 33.9 billion last year, and Mr Instefjord sees no reason to suppose that the overall figure for 2002 will be any smaller.

“But we’ve seen a clear shift from new investment to more operations-related spending and modifications to existing infrastructure. That’ll affect the structure of the industry.”