STATOIL: SOLID DELIVERIES (Part 2)

 

Exploration expenditure in the second quarter of 2007 was NOK 2.3 billion, compared to NOK 1.9 billion in the second quarter of 2006. In the first half of 2007 the exploration expenditure was NOK 4.2 billion, compared to NOK 3.5 billion in the first half of 2006.

 

Exploration expenses for the period consist of exploration expenditure adjusted for the period's change in capitalised exploration expenditure. Exploration expenses in the second quarter of 2007 amounted to NOK 1.2 billion, the same as in the second quarter of 2006.

 

A total of 10 exploration and appraisal wells were completed in the second quarter of 2007, five on the NCS and five internationally. Five wells are confirmed discoveries. One exploration extension well on the NCS was also completed in the second quarter of 2007 and resulted in a discovery. Drilling in nine additional wells was ongoing at the end of second quarter 2007. The number of exploration wells completed in the second quarter of 2006 was seven.

 

In the first half of 2007 a total of 23 exploration and appraisal wells were completed, 11 on the NCS and 12 internationally. One exploration extension well was drilled in the same period. Eleven of the exploration and appraisal wells are confirmed discoveries, seven on the NCS and four internationally. The exploration extension well also resulted in a discovery. The number of exploration wells completed in the first half of 2006 was 13.

 

Production cost per boe was NOK 29.4 for the 12 months ended 30 June 2007, compared to NOK 26.6 for the 12 months ended 31 December 2006 (*).

 

Normalised at a USDNOK exchange rate of 6.00, the production cost for the 12 months ended 30 June 2007 was NOK 29.1 per boe, compared to NOK 26.2 per boe for the 12 months ended 31 December 2006 (*). Normalised production cost is defined as a non-GAAP financial measure (*).

 

Net financial items amounted to an income of NOK 2.3 billion in the second quarter of 2007, the same as in the second quarter of 2006. Net financial items in the first half of 2007 amounted to an income of NOK 3.3 billion, compared to an income of NOK 3.6 billion in the first half of 2006.

 

Income taxes in the second quarter of 2007 were NOK 17.4 billion, equivalent to a tax rate of 61.3%. For the first half of 2007 income taxes were NOK 34.3 billion, with a corresponding tax rate of 64.6%.    

 

* See end notes in the complete quarterly report.

 

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Lars Troen Sørensen, senior vice president investor relations, + 47 90 64 91 44 (mobile), +47 51 99 77 90 ( office)

Geir Bjørnstad, vice president, US  investor relations, + 1 203 978 6950

 

Ola Morten Aanestad, vice president media relations, +47 48 08 02 12 (mobile), +47 51 99 13 77 (office)

 

This document contains certain forward-looking statements that involve risks and uncertainties. All statements other than statements of historical facts, including, among others, statements such as those regarding Statoil's oil and gas production forecasts; production costs and other measures; targets with respect to participation in drilling and exploration activities; plans for future development and operation of projects; expected exploration and development activities; expected start-up dates for projects and operatorships; expected acquisitions or dispositions of assets; plans for integration following the merger of Statoil with Hydro's oil and gas business; expected receipt of regulatory and other approvals required for operations and expected closings of transactions are forward-looking statements. Forward-looking statements are sometimes, but not always, identified by such phrases as "will", "expects", "is expected to", "should", "may", "is likely to", "intends" and "believes". These forward-looking statements reflect current views with respect to future events and are, by their nature, subject to significant risks and uncertainties because they relate to events and depend on circumstances that will occur in the future. There are a number of factors that could cause actual results and developments to differ materially from those expressed or implied by these forward-looking statements, including levels of industry product supply, demand and pricing; currency exchange rates; political and economic policies of Norway and other oil-producing countries; general economic conditions; political stability and economic growth in relevant areas of the world; global political events and actions, including war, terrorism and sanctions; the timing of bringing new fields on stream; material differences from reserves estimates; inability to find and develop reserves; adverse changes in tax regimes; development and use of new technology; geological or technical difficulties; the actions of competitors; the actions of field partners; the actions of governments; relevant governmental approvals; industrial actions by workers; prolonged adverse weather conditions; natural disasters and other changes to business conditions. Additional information, including information on factors which may affect Statoil's business, is contained in Statoil's 2006 Annual Report on Form 20-F/A filed with the US Securities and Exchange Commission, which can be found on Statoil's web site at www.statoil.com.