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And speaking of StatiolHydro, here's a sobering report (may require that you register for free):


StatoilHydro frankly admits: The company expects that specific projects such as Lavrans and Trestakk will be postponed due to the financial crisis and low oil price. The fall in oil price is dramatic. This will affect us, especially in combination with very high cost levels from our suppliers," says StatoilHydro's director of all work on the Norwegian continental shelf, Øystein Michelsen.

"We should be able to live with an oil price of 50 dollars, really. In the long-term, we will see an increased demand for oil. But a lot of what we do today is not sustainable because of high costs, especially when it comes to rigs," says Michelsen.

Audience stunned

He stuns the audience somewhat at the December conference in Kristiansund, as he starts to get specific. In front of a full hall, where most people dream of major development projects off the coast of mid-Norway, Michelsen gets out a map and takes his foot off the accelerator:

"We need to be even stricter in the future, and show greater capital discipline. We don't want to stop anything that is sensible, and do not have a complete overview of what lies ahead," says Michelsen, and squirms when he is asked:

"Which projects on your map may be halted by today's situation?"

" Lavrans and Trestakk," answers Michelsen after pondering a little.


I guess a few questions worth asking (and I don't have the answer or I'd give it) would be, how costly is it for a company like StatiolHydro to cancel a contract? Under what circumstances can they cancel? What recourse does a company like Transocean have in the case of a cancellation?

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