For the past four decades, Norway has built a large portion of its economy on oil and gas production. The government’s shared ownership with industry of oil and gas fields has helped it build the world’s largest sovereign wealth fund.
That partnership has come under debate as Norway positions itself as a leader on climate change and greenhouse gas emissions. The country has adopted an ambitious commitment to reduce its own emissions to 40% below 1990 levels by 2030 and to become a “low emission society” by 2050.
At the same time, Norway has issued a record number of new leases for offshore oil and gas production. Many government leaders argue that Norway should maintain its role as a major fossil fuel producer and exporter and maximize revenues from Norway’s limited resource.
This brief aims to inform this debate, by looking at how parts of the Norwegian tax code support future oil and gas development. It looks at two tax support measures – fast depreciation and uplift – that the government only offers to petroleum producers, in part to overcome the dampening effect of the special petroleum tax of 54%.
It finds that most new, licensed fields in Norway would not be developed without the fast depreciation and uplift measures.
Download the discussion brief (PDF: 2.86 MB)