Alaska and Norway Oil Officials Meet to Discuss Differences
In Anchorage at the Alaska World Affairs Council meeting, Norway’s Minister of Petroleum and Energy, Ola Borten Moe made it clear that having a stable tax regime was critical for Norway to capitalize on its offshore oil and gas resources. Taxation structure certainty is an essential driver for oil development businesses to plan investments. The State of Alaska is in debate of whether reducing oil taxes would lead to more energy development in Alaska. One side argues that high taxes hinder energy investment and development. Norway’s tax on oil and gas companies is slightly higher than Alaska’s.
North Slope Crude – State Tax Rate is 57%, plus U.S. Federal Tax of 15% = 72%
Norway’s taxes 78% on oil and gas firm profits; however, Norway offers plentiful deductions on investments.
Recently, Norway discovered a very large oil field and has had around 150 oil and gas discoveries since 2000. This year Statoil ASA made two offshore discoveries of more than 250 million barrels of oil. Experts believe that 60% of Norway’s oil reserves are still underground. Norway does have a few advantages; one is that its offshore oil fields are closer to major markets such as continental Europe, lowering transportation costs, thus increasing profitability.
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