Petoro - a driving force on the Norwegian continental shelf

SDFI and Petoro annual report 2013

Equity and dividends

Petoro has a share capital of NOK 10 million and is wholly owned by the Norwegian state. The state guarantees the company’s liabilities. The limited company’s own operating expenses are covered by annual appropriations over the central government budget, which are presented as operating revenues in the accounts of the limited company. The company receives grants to meet its costs and does not pay a dividend. The shares in the company are not tradable and cannot be transferred.
Petoro AS established Petoro Iceland AS in December 2012 as a wholly owned Norwegian subsidiary with an Icelandic branch office in order to conduct on-going management of Norwegian participatory interests in two production licences awarded by the Icelandic government on 4 January 2013. The branch office serves as the licensee. The Norwegian state’s participatory interest in each of these production licences is 25 per cent. From 2013, Petoro AS will present consolidated accounts which include activity in Petoro Iceland AS. Administration of Petoro Iceland AS and funding for the Norwegian state’s participation in petroleum operations on the Icelandic continental shelf are covered by a separate item in the central government budget. The branch also manages a 25 per cent participatory interest in a third production licence awarded by the Icelandic government on 22 January 2014.

Equal treatment of shareholders and transactions with close associates

The shares in Petoro AS are wholly owned by the Norwegian state. As a result, the company has no personal shareholders and no share transactions occur with close associates. Petoro Iceland AS entered into an agreement with Petoro AS on an overdraft facility during 2013. This agreement was treated in accordance with section 3-8, see section 2-6, first paragraph, nos 1-4, of the Norwegian Limited Liability Companies Act, and was reported to the Norwegian Register of Business Enterprises.
The government has a common ownership strategy to maximise the collective value of its equity holding in Statoil ASA and the state’s direct oil and gas interests. On that basis, Statoil ASA undertakes the marketing and sale of the state’s petroleum pursuant to a marketing and sale instruction approved by the general meeting of Statoil ASA. Through article 11 in Petoro’s articles of association and the marketing and sale instruction for Statoil ASA, the government has given Petoro responsibility for monitoring that Statoil ASA performs its duties in accordance with this instruction.

A duty of commercial confidentiality applies to information Petoro receives through its monitoring of Statoil’s marketing and sales and in its work on the budget and accounts relating to the marketing and sale of the state’s petroleum. The company’s ethical guidelines emphasise that the recipient of such confidential information must use it only for its intended purpose, and must not trade in Statoil ASA’s securities for as long as the information is not publicly known.