Possible and impossible oil company modelsWinning agreement on a state oil company

The 10 oil commandments

Developing policies for the young oil nation shifted into top gear with the Ekofisk discovery. That included considering issues of principle related to petroleum production on the Norwegian continental shelf (NCS). These were addressed by a reinforced standing committee on industry in the Storting (parliament).
By Kristin Øye Gjerde, Norwegian Petroleum Museum
- The 10 oil commandments presented in the exhibition on oiling the economy at the Norwegian Petroleum Museum. Photo: Shadé B. Martins/Norwegian Petroleum Museum

Chaired by the Labour Party’s Rolf Hellem, this committee’s work led to the formulation of what has since become known as the “10 oil commandments” – a set of political guidelines which stood the test of time over subsequent decades.

Hellem was a railway worker from Narvik who had been a Storting representative since 1965. The opportunities offered by the oil industry fascinated him, and he read virtually everything available about the subject.

To learn more about oil production, the committee he chaired and the oil office at the Ministry of Industry made a joint study trip to the UK, the USA and Canada. This group learnt about bringing oil ashore in Britain, oil production in pack ice off Alaska, and using artificial islands for production and drilling off California. In Los Angeles, it viewed camouflaged derricks and production facilities in urban areas and was given demonstrations of technical equipment for deepwater production and preventing oil spills.

The main purpose of the visit to Canada was to secure more information about petroleum-related legislation, safety measures and administration. A lot could be learnt from the experience of other countries.

The oil commandments

Rolf Hellem. Photo: Storting

The Storting committee produced a set of recommendations on 7 June 1971 which analysed many issues of principle. This analysis was summed up in a series of points – the “10 oil commandments”.

Hellem can claim the credit for producing this summary, which expressed to a great extent what was to become the prevailing Norwegian policy on oil and gas in the years which followed.[REMOVE]Fotnote: Norwegian Oil and Gas, November 2016: “Mannen som skrev de ti oljebud.”

1. National supervision and control must be ensured for all operations on the NCS.

2. Petroleum discoveries must be exploited in a way which makes Norway as independent as possible of others for its supplies of crude oil.

3. New industry will be developed on the basis of petroleum.

4. The development of an oil industry must take necessary account of existing industrial activities and the protection of nature and the environment.

5. Flaring of exploitable gas on the NCS must not be accepted except during brief periods of testing.

6. Petroleum from the NCS must as a general rule be landed in Norway, except in those cases where socio-political considerations dictate a different solution.

7. The state must become involved at all appropriate levels and contribute to a coordination of Norwegian interests in Norway’s petroleum industry as well as the creation of an integrated oil community which sets its sights both nationally and internationally.

8. A state oil company will be established which can look after the government’s commercial interests and pursue appropriate collaboration with domestic and foreign oil interests.

9. A pattern of activities must be selected north of the 62nd parallel which reflects the special socio-political conditions prevailing in that part of the country.

10. Large Norwegian petroleum discoveries could present new tasks for Norway’s foreign policy.[REMOVE]Recommendation from the reinforced industry committee on prospecting for and recovering submarine natural resources on the Norwegian continental shelf, etc (Recommendation no 294 (1970-71) to the Storting), 7 June 1971.

These 10 sentences emphasised that the most important goal was to secure national supervision and control. Norway was to make itself independent of crude oil supplies. To ensure that, offshore production was to be landed directly in the country. New petroleum-based industrial activity was also to be created, and the government would support an integrated Norwegian oil community. In addition, a state-owned Norwegian oil company would be established to look after the state’s commercial interests and to maintain appropriate collaboration with both domestic and foreign oil interests.[REMOVE]Fotnote: Ibid. This declaration is regarded as fundamental for further development of the legislative framework and practical policies related to Norway’s petroleum sector. Its content enjoyed cross-party support.


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