The Norwegian state has large holdings in oil and gas licences on Norway’s continental shelf (NCS) through the State’s Direct Financial Interest (SDFI). These are managed by Petoro AS. The company’s most important job is to help ensure the highest possible value creation from the SDFI – value which benefits the whole of Norway.
2014 was the year of a sharp downturn in the industry. Driven by a high level of costs and a switch by the oil companies from volume to value, the willingness to invest on the Norwegian continental shelf (NCS) has been reduced.
The directors’ report describes financial and operational results for the SDFI and Petoro AS. Furthermore developments in the environment and outlook are discussed.
Net income for the portfolio in 2014 came to NOK 119.7 billion, compared with NOK 132.8 billion the year before. Total operating revenue was NOK 179.8 billion, compared with NOK 194.3 billion in 2013.
Goals achieved and results
The letter of assignment describes the framework and priorities, targets and reporting requirements for the company in 2014. In this chapter Petoro describes the company's performance in relation to this.
Managing huge assets on behalf of the Norwegian state makes big demands on corporate governance in Petoro that meet expectiations from stakeholders and the society.
Petoro undertakes to pursue its business activities in an ethically acceptable, sustainable and responsible manner.
Managing the portfolio is subject to the accounting regulations for the government. Accounts for the portfolio are presented both on the cash basis used by the government and in accordance with the Norwegian Accounting Act.
Accounts Petoro AS
The company maintains separate accounts for all transactions relating to the participatory interests, so that revenue and expenses for the portfolio are kept apart from operation of the company. Petoro’s operating revenue takes the form of a contribution from the government. Group accounts also include the accounts for Petoro Iceland AS.