Foils from the speech in pdf

Your Excellencies, ladies and gentlemen: I am very pleased to welcome you to this Indonesian-Norwegian seminar. I know some of you went on a field trip yesterday, some to Solbergfoss hydropower plant and some to Aker Kværner, DnV and FMC. I hope you enjoyed the visits, and that you got more familiar with these Norwegian companies.

A Memorandum of Understanding between Indonesia and Norway was signed in 1995. From the Norwegian side, this MoU was actually signed by our current Prime Minister, Mr. Jens Stoltenberg, back in 1995 when he was Minister of Industry and Energy. It has been a while since the last meeting in Jakarta and it is a pleasure for me to return the favour and welcome such a large and distinguished delegation to Oslo today.

I will use this opportunity to brief you about the Ministry of Petroleum and Energy’s responsibilities and to inform you about the Norwegian policies on power and oil and gas. I also want to share with you the competence we have in Norway within the field of energy.

Norway – a large energy producer
Norway is well-endowed by nature with a number of primary energy sources, including crude oil, natural gas and waterfalls.

Norway is a small country in terms of population; but in terms of petroleum production and exports we are ranked as the world’s third largest oil exporter, behind Saudi Arabia and Russia, and the eight largest producer in the world. In addition we supply Europe with about 15 percent of its gas demand, being the world’s third largest producer and exporter of gas.

Hydropower accounts for more than 99 percent of the electricity generated in Norway. Norway is the sixth largest hydro power producer in the world and we have the world’s largest per capita hydro power production.

In addition to hydropower, we have a large untapped renewable energy potential from other sources, such as wind power and bio energy, as well as tidal and wave power. This holds promises for the future, when renewable and clean energy will be even more in demand.

The Ministry of Petroleum and Energy aims to achieve a coordinated and integrated energy policy. A primary objective for us is to ensure high value creation through efficient and environmentally sound management of Norway’s energy resources.

The Ministry is responsible for managing the petroleum resources on the Norwegian Continental Shelf. The Norwegian Petroleum Directorate is subordinate to the Ministry. The directorate plays a major role in the management of the petroleum resources and is an advisory body for the Ministry. I know that Steinar Njå from the Norwegian Petroleum Directorate will tell you more about the directorate’s work later today at the oil and gas session.

The Ministry is responsible for the management of the energy and water resources in mainland Norway. The Norwegian Water Resources and Energy Directorate, a subordinate agency of the Ministry, plays a major role in managing the energy and water resources.

Hydropower inNorway
As I just mentioned, Norway is the world's sixth largest hydropower producer, with an average annual production of about 120 Terawatt hours. The installed capacity is close to 28 000 MW, spread around in more than 600 plants around the country. More than 200 are underground, which is close to half of the world total of underground power houses.

Domestic demand for electricity is met almost exclusively through renewable and clean hydropower, which has been very beneficial to our environment and economic development. Hydropower was the backbone of energy supply when Norway was transformed from one of the poorest countries of Europe about one century ago, to the industrialized and wealthy nation of today.

From the early 1900s, hydropower has been recognised as a resource that should benefit the whole society. Another important feature is the development of a highly skilled Norwegian industrial cluster. This cluster covers all aspects related to hydropower development, from pre feasibility studies to the power sales. This industry is very active in Asia and elsewhere.

Norway was one of the first countries to introduce a free power market for electricity in production and trade. Today, we are an integrated part of a Northern European electricity market. Substantial amounts of power are traded via the power pool – NordPool – in Oslo. Unlike most other countries, we chose to restructure the electricity sector without privatisation. 85 per cent of the Norwegian hydropower production is owned either by the state or the local authorities. The state owns about 35 per cent through Statkraft, which is one of the largest hydropower companies in Europe.

One of our domestic challenges is the fact that the growth in electricity consumption is higher than the increase in production in a year with average rainfall. We are looking into various strategies to close the gap between domestic supply and demand of electricity. A few years ago we started a programme aiming to supporting new renewable sources, such as wind-power, biomass and introducing energy efficiency initiatives. In addition, there is a huge interest in small hydropower projects. From the positive reactions so far, this area looks very promising.

Norwegian Continental Shelf – Undiscovered resources
Then I turn to the petroleum sector in Norway. It is important to emphasize the huge potential that lies within the petroleum industry in Norway. A large resource base and the competence and technology level in the sector are our most important assets. We continue to focus on long term activity on the Norwegian Continental Shelf and at the same time give attention to international markets. This is necessary to maintain high value creation from this sector.

Today, the petroleum industry is the largest industry in Norway. In 2005, the sector accounted for 25% of the value creation in the country. Through direct and indirect taxes and direct ownership, the state is ensured a high proportion of the values created from the petroleum activities.

Technology development has been fundamental to the development of Norwegian petroleum resources. Through targeted R&D efforts we have managed to overcome the technological challenges and barriers that exploitation of the resources on the NCS have represented. Technological development is important in order to exploit our petroleum resources more efficiently but also to seek new and improved solutions with regard to environmental challenges. Partnerships between the oil companies, the service industry and the R&D community have been important in this respect.

In order for us to stay competitive it is important that both the companies and the government focus on technology, competence and education. Over the years our investments in R & D has paid off significantly.

Petroleum related export
After petroleum was first discovered on the Norwegian Shelf, one of our key objectives has been to secure that the petroleum resources shall be managed for the benefit of the Norwegian society as a whole. Development of national knowledge and competence was an important goal at an early stage. We have developed a world class petroleum cluster in Norway through transfer of technology and knowledge and active cooperation between national and international companies

I am very pleased to see that the Norwegian industry succeeds internationally. During the last decade, the Norwegian petroleum industry has managed to win market positions in petroleum provinces all over the world. A significant trend is that the turnover from geographically distant regions is increasing considerably.

Since 1995, turnover from international markets has tripled. This is remarkable when activity in the home market has never been higher. The industry has managed to maximize value creation in Norway and to expand internationally.

Let me conclude: Norway will continue to focus on areas where we have world-class competence to share with countries which develop their natural resources. The petroleum and hydropower sectors are two of these areas where Norwegian companies have a lot of experience and competence. I would be pleased to see closer cooperation between Indonesian and Norwegian companies within the energy sector.

I hope you will have a fruitful day at the Indonesian-Norwegian seminar.
Thank you for your attention!