“The way we deliver will be just as important as the results delivered. We want to be recognised as a group which combines good performance with high integrity.” Helge Lund, president and CEO
Our most important job is to create value for our owners. My principal responsibility as chief executive is to develop a strong, competitive and efficient group. To succeed in that endeavour, health, safety and environmental considerations must underpin everything we do. We thereby make our group more robust, reliable and competitive. It is also important to remain an attractive place to work, which offers our employees good development opportunities.
We wrote industrial history in Norway during 2007, implementing the merger between Statoil and Hydro’s oil and gas business in less than year. Throughout the merger period, we also devoted full attention to safe and good operations and maintained positive results. A big commitment by the whole organisation as well as good and close collaboration with union officials made this possible.
Our group is the result of the biggest-ever merger in the Nordic region. As operator for a total production exceeding three million barrels per day, we are the world’s largest operator in deep water. The merger was driven primarily by the need to strengthen our international competitiveness. At the same time, we are realising major benefits and gains on the Norwegian Continental shelf (NCS) which will benefit our owners, our partners and society.
In parallel with the integration process, we established new platforms for long-term international growth over the past year. We have further strengthened our position in North America through a major acquisition in Canadian oil sands and by acquiring exploration licences in the Gulf of Mexico and off Alaska. In addition, we secured a position with Russia’s Shtokman field. These will be important areas for us in the years to come.
As an industry, we live on top of the global stress zone where the need for secure and adequate energy supplies rubs up against the climate challenge. The climate issue represents both a challenge and an opportunity. Its challenge is to reduce greenhouse gas emissions. Its opportunity is the commercialisation of more environment-friendly solutions and products. We are constantly challenged over the footprint we leave as an energy company. In coming years, our competitiveness will be influenced by our industrial response to the climate challenge.
Our response involves both making our core business cleaner and more energy efficient, and strengthening our involvement with new energy. This is why we are committed to enhancing energy efficiency and develop environmental technology. This is why we are developing new technology for carbon capture and storage at Mongstad. And this is why we are stepping up our involvement in renewable energy, with the focus on wind power and biofuels.
Our move last year into Canadian oil sands was first and foremost about realising major resources which can help to meet the world’s growing energy demand. At the same time, we are working on technology and industrial measures which address the associated environmental and climate challenges.
Technological development is at an early stage in this area. That is precisely why we have established our new technology centre for heavy oil in Calgary. Our starting point is solid experience from areas such as managing carbon emissions, enhancing energy efficiency and improving oil recovery. No easy fixes are available, but I am convinced that we have a lot to contribute. Our ambition is also to develop more efficient and environment-friendly solutions for heavy oil.
Opportunities in our industry are defined more by geology than by geography. The world’s oil and gas resources are often found in areas which pose major development challenges. Poverty, corruption and human rights violations present us with demanding conditions. This calls for extra vigilance to ensure that we conduct our business with a high degree of openness and within an uncompromising performance framework defined by our values, HSE principles and ethical platform. Our best contribution to social development is to conduct an efficient and profitable business within this framework. We also work systematically on measures to operationalise our corporate social responsibility.
Our work on sustainability is about continuous improvement. Last year showed that we need to improve in a several areas. Since we believe that all accidents can be prevented, it is deeply regrettable that our group was involved in three fatal accidents during 2007. These were tragic incidents which caused irreplaceable loss for the bereaved.
The oil spill from the Statfjord A platform in the North Sea was unacceptable. The investigation exposed weaknesses and deficiencies which we cannot accept, given our high ambitions in the environmental area. We have initiated a number of improvement measures to ensure that such events are not repeated.
An oil and gas company which aims to compete successfully over tomorrow’s resources must take sustainability seriously. Our ambition is to be part of the solution to important sustainability challenges. We then need an active and open dialogue with the society around us. Our interaction with owners, government authorities and civil society will help to make us even better. Only in that way can we strengthen and renew our contribution to meeting future challenges and expectations.
