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Strengthening Snohvit

October 9, 2002, 10:30 CEST

Statoil's review of the Snøhvit project has revealed a necessity to strengthen the project's management and organisation, with the objective of securing better follow-up of costs and progress.

"The Snøhvit project is Statoil's largest and most complex development project," says chief executive Olav Fjell.

Mr Fjell emphasises that Statoil is deeply committed to ensuring a successful execution of the project.

Earlier this autumn, the group identified a cost increase for parts of Snøhvit, and has followed this up with an internal review of the entire project.

The review shows that a reinforcement of the project's management and organisation is required. Snøhvit is therefore being transferred from Statoil's Exploration and Production Norway business area and will now report directly to chief financial officer and executive vice president, Inge K Hansen. The project will also intensify follow-up of the Linde group which is the main contractor for the gas liquefaction plant at Melkøya in Finnmark county.

Statoil will continue to examine all aspects of the project and will present its findings to the Snøhvit partners later this autumn. It is not clear whether it will be necessary to increase the project's investment framework, or whether the identified cost increase will be covered by the item for contingency funding.

In order to give Mr Hansen sufficient time to deal with the Snøhvit project, the group's senior vice president for health, safety and the environment, Stig Bergseth, is now to report directly to chief executive Olav Fjell.