Statoil positioned for long term growth

Today, Statoil (OSE: STL, NYSE: STO) presents its long term growth outlook. The
company expects to raise production from around 1,9 million barrels in 2010 to
above 2.5 million barrels of oil equivalents per day in 2020. With premium
positions on a revitalised Norwegian Continental Shelf (NCS) and a world class
project portfolio, Statoil is positioned to deliver strong shareholder returns.
 
Celebrating its ten years anniversary as a publicly listed company, Statoil
expands on its outlook for the coming years at the Capital Markets Day at the
New York Stock Exchange.
 
-  We have made significant strategic progress and have proven ability to
deliver competitive returns since our IPO in 2001. With a premium project
portfolio and strong commitment to leverage the company's competitive strengths,
we will continue our journey, says Helge Lund, president and CEO of Statoil.
 
- The industry has changed considerably since we listed the company. Today we
announce a strategy that reflects those changes and how we address them to the
benefit of our shareholders, Lund adds.
 
Statoil grew production at a compound annual growth rate (CAGR) of 3% in the
last decade, excluding the Hydro merger. Production is expected to continue
growing at the same rate over the next ten years, reaching a level of above 2.5
million barrels of oil equivalents (boe) per day in 2020.
 
  * A first wave of new projects will provide a step-up in production in 2012,
    delivering around 3% CAGR 2010-2012.
  * A second wave of projects will give further growth from 2014 and onwards,
    providing a 2-3% CAGR for the years 2012 - 2016 with production in 2013
    expected to be around 2012 level.
  * A third wave of projects will provide a 3-4% CAGR from 2016 to 2020, taking
    production above 2.5 million boe per day in 2020.
 
This corresponds to an overall CAGR of around 3 % from 2010 till 2020, a growth
rate backed by a strong resource base and a portfolio of world class projects.
In 2020 the production from NCS is expected to be above 1.4 million boe per day,
while the international portfolio is expected to produce above 1.1 million boe
per day.
 
- The NCS has a significant potential and continues to yield long term, superior
value creation opportunities in an investment friendly environment. The NCS
remains a very attractive and globally competitive province for future oil and
gas activities, says Helge Lund.
 
To realise the project portfolio Statoil increased investments for 2011 to USD
16 billon, and expects the investments in 2012 to be at the same level.
 
- Towards 2020 our ambition is to establish material positions in 3 - 5 offshore
business clusters outside the NCS and step up our shale gas and liquids
production. These positions have significant resource potential and through
exploration, business development and the application of our distinct
technological capabilities we will lift value creation beyond today's levels,
Lund says.
 
The offshore business clusters include Gulf of Mexico, Brazil, Angola, the
Caspian region and Arctic outside the NCS.
 
Statoil today announces discoveries in both side tracks on the Peregrino South
well, immediately adjacent to the newly opened Peregrino field offshore Brazil.
The estimates of recoverable volumes in Peregrino South are between 150 - 300
million boe. This discovery brings a phase two development of the Statoil
operated Peregrino field considerably closer.
 
Statoil also confirms an increase in expected volumes from the Skrugard oil
discovery in the Barents Sea in Norway. The Skrugard volumes are now estimated
at approximately 250 million boe recoverable resources, with a significant
upside potential in the license. The Skrugard well has significantly improved
Statoil's understanding of other prospects in the area.
 
- Our recent performance marks an early indication that our sharpened
exploration strategy is working. This reaffirms that our competence and
experience allow us to pursue an exploration strategy emphasising early access
at scale and priority to high impact opportunities, says Helge Lund.
 
Statoil expects to drill 20 - 25 high impact wells in the years 2011 - 2013.
 
Technology focused, upstream strategy
 
In recent years, Statoil has streamlined its business, reinforcing its position
as a technology focused upstream company. While building a leading position on
the NCS, Statoil has taken positions in a number of the world's most prolific
provinces and established an attractive resource base. Since listing the company
has increased its non-Norwegian production more than five fold. The core
competencies and capabilities, including innovative development and application
of technology coupled with the execution of complex offshore and onshore field
development projects, positions Statoil as operator and partner globally.
 
Statoil's long term strategy focuses on six core building blocks. Firstly,
Statoil will further revitalise and expand the NCS horizon with high value
barrels. The company's position on the NCS remains a strong cash generator, with
a set of premium projects that form the foundation for its growth outlook.
Secondly, Statoil will utilise its superior gas position to deliver value in
strong and growing markets. Thirdly, the company will leverage its leadership in
complex offshore projects, and build material positions in 3-5 business clusters
in addition to the NCS. Fourthly, it will continue to strengthen its resource
base through leading exploration activities. Fifthly, Statoil will step up the
company's shale gas and liquids activity, strengthening performance based on its
early entry and core technology competencies. Finally, the company will further
enhance shareholder return through active portfolio management.
 
In addition the focus on renewables concentrated around offshore wind continues.
Statoil has taken important positions currently centred on the Sheringham Shoal
and Dogger Bank projects in the UK
 
A new industrial horizon in Norway
 
Statoil sees three long term business clusters on the NCS - the North Sea, the
Norwegian Sea and the Barents Sea.
 
The Skrugard discovery provides renewed optimism for the whole Barents region.
It also reaffirms the long term perspective of the NCS, where there is a set of
opportunities based on current producing assets and access to new, promising
areas. The delineation agreement between Norway and Russia, and statements from
the Norwegian government on its intent to give access to new acreage, adds to a
positive outlook for the Barents Sea.
 
The company will maximise the value of the North Sea through operational
improvements, IOR measures and development of satellite fields. The development
of new fields, such as Valemon, Gudrun and Dagny/Ermintrude represents a
significant business opportunity. In the Norwegian Sea cluster, the company will
fast track the projects in the pipeline, and is looking at further growth
options, including opening of the resource rich areas of Nordland VI and VII.
 
Capturing value from gas
 
Natural gas is emerging as the most plentiful, cost efficient and cleanest of
fossil fuels. There is a particularly strong case for an increased use of gas in
power generation. Gas is cost competitive with coal, nuclear and renewables,
which allows for even higher gas prices. Growing demand for gas in Asia will
also impact prices in Europe through export of LNG. Statoil is well positioned
to take part in this expected growth in the gas markets.
 
The positive outlook for gas, and the opportunities for enhanced value creation
in the expanding markets worldwide, covers conventional as well as
unconventional resources. Going forward our industrial roadmap for North
American will focus on building the Marcellus and Eagle Ford positions, taking
on operatorship and growing into new areas.
 
Further information from:
 
Investor relations
 
Hilde Merete Nafstad, senior vice president investor relations,
 
Tel: + 47 957 83 911 (mobile)
 
Morten Sven Johannessen, vice president investor relations USA,
 
Tel: + 1 203 570 2524 (mobile)
 
Press
 
Jannik Lindbæk jr, vice president for media relations,
 
Tel: + 47 977 55 622 (mobile)
 
This information is subject of the disclosure requirements acc. to §5-12 vphl
(Norwegian Securities Trading Act)
 
EXP Dodson: 
http://hugin.info/132799/R/1524563/460351.pdf
 
DPNA Maloney: 
http://hugin.info/132799/R/1524563/460350.pdf
 
DPN Michelsen: 
http://hugin.info/132799/R/1524563/460349.pdf
 
CEO and CFO: 
http://hugin.info/132799/R/1524563/460346.pdf
 
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Source: Statoil via Thomson Reuters ONE
 
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