1
The Royal Ministry of Petroleum and Energy (the Ministry) hereby announces an 
invitation to apply for petroleum production licences on the Norwegian Continental 
Shelf, in accordance with the Act of 29 November 1996 No.72 pertaining to 
Petroleum Activities (the Petroleum Act) and the Petroleum Regulations laid down by 
Royal Decree of 27 June 1997 (the Petroleum Regulations).

Applicants are made aware that the Ministry is considering certain minor changes and 
clarifications in the regulations, see consultation memo 2 May 2017. The award will 
be assessed according to the applicable rules at the date of award.

2
Production licences will only be awarded to joint stock companies registered in 
Norway or in another state party to the Agreement on the European Economic Area 
(the EEA-Agreement), or to natural persons domiciled in a state party to the EEA-Agreement. 

Companies which are not licensees on the Norwegian Continental Shelf may be 
awarded licences if they are prequalified as licensees on the Norwegian Shelf.

Individual applicants and companies applying as part of a group will be treated on 
equal terms by the Ministry. Applicants submitting an individual application or 
applicants being part of a group submitting a joint application, will be considered as 
an applicant for a production licence. The Ministry may, on the basis of applications 
submitted by groups or individual applicants, assemble licensee groups of applicants
to be awarded a license, including removal of applicants that are part of a group
application and add to individual applicants, as well as appoint the operator for such 
groups.

3
The award of production licences will be carried out in accordance with the 
previously established practice for awards on the Norwegian Continental Shelf. This 
implies that the acreage, location, licence period, work obligation, and other block 
specific conditions will be stipulated at the time of the award.

Applications for participating interests in production licences may be submitted for 
the blocks that are not licenced within the predefined area, which are marked out on 
the maps. It is also possible to apply for acreage that is relinquished within the 
predefined area after the announcement has happened according to updated maps 
(Norwegian Petroleum Directorate’s interactive Factmaps that show the available area 
are found on the NPD's web-page).

Each production licence may comprise one or more blocks or part of block(s). The 
applicants are requested to refine the application outline to areas where they have 
mapped prospectivity.

4
Conditions for the award

a) As a condition for the award of a participating interest in a production licence, the 
licensees will be required to enter into an Agreement for Petroleum Activities, 
including a Joint Operating Agreement and an Accounting Agreement. If the 
production licence is stratigraphically divided, above or below another licence, the 
licensees will also be required to enter into a Joint Operating Agreement between the 
stratigraphically divided production licences.

Upon signing the agreements the licensees will form a joint venture in which the size 
of their participating interest at all times shall be identical to their participating 
interest in the production licence.

The wording in the licence documents will generally be equivalent to that in 
documents from Awards in Predefined Areas 2016. The aim is for the main features 
in any adaptations in the framework to be announced to the industry before the 
expiration of the application deadline.

b) The conditions relating to environmental concerns, HSE and fishery interests are 
stated in detail in the attachment for environmental concerns, HSE and fishery 
interests. Specific conditions are attached to certain blocks.

5
Negotiation issues

The Ministry reserves its right to negotiate terms with the applicant(s) on the 
following issues:

1. The area of the production licence.
2. The content, extent and time schedule for the work obligation(s).
3. The duration of the initial period of the production licence, and the duration of 
   the licence period after expiry of the initial period.

Decision on the length of the initial period, cf. the Petroleum Act Section 3-9, will in 
the Awards in Predefined Areas 2017 be made on the basis of block specific 
conditions. 

The work obligations in the production licences will as a main rule include
requirements for a work schedule for licence activities towards the submission of a 
plan for development within the initial period. The work obligations will consist of a 
series of decision points and corresponding licence activities that must be fulfilled 
within given time frames. In case of non-compliance with the work schedule, the 
production licence should be relinquished or it will lapse. 

The Ministry, with a copy to the NPD, shall be informed about the decision taken in 
each decision point. If relinquished, the licensees shall within three months send the 
NPD a status report. This status report shall contain a summary of collected data, any 
studies including the results from these, plus an account of the prospectivity in the 
relinquished area.

The work obligations may be formulated in such a way that the licence group is 
initially given a period to carry out for instance a seismic obligation before it decides 
on whether to carry out the drilling obligations required or relinquish the entire area of 
the production licence. 

Further, the work obligation will as a main rule include a requirement to, within the 
initial period, submit to the Ministry for approval, a plan for development of the 
deposit concerned. 

Upon expiry of the initial period, the area covered by the production licence that is not 
included in the submitted plan for development, shall, as a main rule, be relinquished. 

6
Award criteria

To promote good resource management and rapid and efficient exploration for and 
production of petroleum on the Norwegian Continental Shelf, including the 
composition of licence groups to ensure this, the following criteria shall apply to the 
award of participating interests in production licences and to the appointment of 
operator:

1. The applicant's geological understanding of the geographical area in question, 
   and how the licensees propose to perform efficient exploration for petroleum.
2. The relevant technical expertise of the applicant, and how this expertise may 
   actively contribute to cost effective exploration and, as appropriate, the 
   production of petroleum from the geographical area in question.
3. The applicant's experience on the Norwegian Continental Shelf or equivalent 
   relevant experience from other areas.
4. That the applicant has the satisfactory financial capacity to carry out 
   exploration for and, as appropriate, production of petroleum in the 
   geographical area in question.
5. If the applicant is or has been a licensee in a license, the Ministry may take 
   into account any form of inefficiency or lack of accountability demonstrated
   by the applicant as a licensee.
6. Production licences will mainly be awarded to a joint venture where at least 
   one participating interest have drilled at least one well on the Norwegian 
   Continental Shelf as operator or have equivalent relevant operational 
   experience outside the NCS.
7. Production licences will mainly be awarded to two or more participating 
   interests, where at least one has experience as mentioned under f)
8. The appointed operator for production licences in the Barents Sea shall have 
   drilled at least one well on the Norwegian Continental Shelf as operator or 
   have equivalent relevant operational experience outside the NCS.
9. For production licences in deep waters, both the appointed operator and at 
   least one other participating interest shall have drilled at least one well on the 
   Norwegian Continental Shelf as operator or have equivalent relevant 
   operational experience outside the NCS. In the production licence one 
   participating interest shall have drilled in deep waters as operator.
10. For production licences where drilling of exploration wells in high pressure 
    and/or high temperature (HTHP) is expected, the appointed operator and at 
    least one other participating interest shall have drilled at least one well on the 
    Norwegian Continental Shelf as operator or have equivalent relevant 
    operational experience outside the NCS. In the production licence one 
    participating interest shall have drilled a HTHP-well as operator.

7
State participation

At the time of the award, state participation may be stipulated in each production 
licence. Petoro AS is the licensee on behalf of the State's participating interest (the 
State's Direct Financial Interest - SDFI)

8
Application letter

All companies applying for production licences in APA 2017, individually or as part 
of a group, shall within the application deadline submit a formal application letter 
together with the application(s). If the company only participates in applications 
delivered by other companies, the letter shall be sent to the Ministry of Petroleum and 
Energy (MPE) and a copy to the Norwegian Petroleum Directorate (NPD). The 
application letter shall be in accordance with guidelines on NPDs website: 
http://www.npd.no/apa2017

9
Information about the company

All companies applying for production licences in APA 2017, individually or as part 
of a group, shall within the application deadline provide information on company 
related matters to the authorities. 

Information on financial and company related matters and shall be in accordance with 
guidelines on NPDs website: http://www.npd.no/apa2017

10
Application

Each application for awards in APA 2017 shall include the following information, and 
in the following order: 

1. Summary of the application.
2. Geological evaluation of the block(s) applied for.
3. Description of the anticipated reservoir and development solutions for the 
   block(s) applied for.
4. Description of:

• • • the extent, content and time schedule for the work obligation the 
      applicant(s) proposes to undertake for the acreage covered by a production 
      licence;
    • the duration of the initial period of the production licence;
    • the duration of the licence period after the expiry of the initial period.

The above mentioned terms shall be adjusted to the specific characteristics of the
block(s), with the aim of obtaining the highest value added from the relevant
geographical area.

Applications for additional acreage to existing production licenses have reduced
requirements regarding content.

Guidelines for the preparation of an application for a production licence, forms and
block coordinates for the blocks announced are available at the NPD’s Internet webpage
at the following address: http://www.npd.no/tfo2017
(Norwegian version), or http://www.npd.no/apa2017 (English version).

The authorities may require additional information.

Business information contained in the application and the enclosures will be kept 
confidential by the authorities, regardless of the time limit stipulated in the Petroleum 
Regulations, Section 85.

11
Fee

For handling of each application for a production licence, a fee is due upon 
submission of the application. If the fee is not paid, the application is considered not
handed in.

The fee is NOK 123 000 for each application for a production licence, cf. the 
Petroleum Regulations, Section 9. In the cases where several companies apply as a 
group, this counts as one application. One of the group members shall in this case see 
to a joint payment of the fee for the application.

The fee shall be paid to the State, c/o the Norwegian Petroleum Directorate, current 
account No. 7694.05.00326. The payment should be marked ”APA2017 (block no)”. 
A copy of the receipt for said payment shall be attached to the application letter from 
the company.

12
The King in Council is not obliged to award any production licence on the basis of
applications received, cf. the Petroleum Act, Section 3-5, third paragraph.

13
Applications for production licences must be submitted to the Ministry in electronic
format.

Applications must be sent to:

The Royal Ministry of Petroleum and Energy
attn. Cecilie Myklatun
P.O. Box 8148 Dep,
0033 Oslo

Upon the applicant’s request, the application can alternatively be submitted directly to
the Ministry of Petroleum and Energy within the application deadline. This should be
agreed in advance with the Section for Exploration in the Ministry of Petroleum and
Energy.

The applications must be delivered by 12.00 a.m. on 01..September 2017. All
applications submitted before this date and time shall be considered as received
simultaneously.

Applications must be submitted to the Norwegian Petroleum Directorate in electronic
format on a memory stick within the deadline.

The application letter should be enclosed in paper format, as well as included
electronically on a memory stick together with the company information.
The Norwegian Petroleum Directorate

P.O. Box 600
4003 STAVANGER
NORWAY

The application may be written in Norwegian or in English.

14
The award of production licences in the Awards in Predefined Areas 2017 on the 
Norwegian Continental Shelf is planned to take place within 1st quarter of 2018.