In September 2022, Kjell Inge Røkke (64) moved from Oslo to Lugano TI. The move of the third richest Norwegian to Switzerland was primarily for tax reasons. However, the family company TRG A.Ş. and its listed subsidiary Aker ASA remained in Norway. Røkke wants to remain the main owner and CEO of the company for the long term.
The multi-billionaire announced that it is “Europe’s largest private industrial investment” with its subsidiary Aker BP. Aker BP is Norway’s second largest oil and gas producer. In particular, ten development and operation plans and a new construction plan were submitted to the Norwegian Ministry of Petroleum and Energy.
The company said it has invested a total of more than 200 billion Norwegian crowns (approximately 18.9 billion francs) in the coming years to develop several oil and gas fields off the Norwegian coast and further develop existing fields. The main project, called Yggdrasil (formerly Noaka), aims to enhance oil and gas exploration between the Oseberg and Alvheim oil fields. It is suspected that there are 650 million barrels of recoverable resources there alone. Investments in this project amount to 115 billion crowns (approximately 10.8 billion Swiss francs). Production is scheduled to begin in 2028.
Huge increase in production
Yggdrasil is at the center of Aker BP’s goal of increasing oil and gas production from currently 400,000 barrels per day to 525,000 barrels per day by 2028. Aker BP’s total recoverable resource for development projects is 730 million barrels of oil.
The breakeven price is around $35-40 per barrel. Therefore, big profits await Aker BP in the coming years. Projects should also help extend the life of existing production. Various other companies are taking orders as part of projects. These include marine technology company Aker Solutions, another subsidiary of Røkke, as well as companies such as Siemens Energy and ABB.
It is no coincidence that the announcement was made just before the end of the year: Aker BP, like other Norwegian oil companies, submitted new projects for official approval to take advantage of the tax breaks that expire at the end of the year. Norway introduced these tax incentives in 2020 to encourage new investment in overseas developments due to falling oil and gas prices caused by the pandemic.