Statoil Cuts Output Goal by 12% on Delays, Shutdown

Statoil ASA, Norway’s largest oil company, cut its 2007 production target by as much as 12 percent after the closure of a North Sea field and delays at projects from Azerbaijan to Algeria.

Output will average between 1.15 million and 1.2 million barrels of oil equivalent daily this year, down from a previous target of 1.3 million barrels, the Stavanger, Norway-based company said today in a statement. Statoil, which pumped 1.135 million barrels last year, first announced it would miss the old estimate on April 26.

Statoil has cut its target twice since September, when it said delays and output halts at fields from Iran to Norway would reduce output by 3 percent this year. Technical problems at the Shah Deniz field in Azerbaijan and the In Amenas site in Algeria further set back plans to boost output, the company said today.

“A lot of the large oil companies are struggling to increase production,” said Eric Nasby, an analyst at Handelsbanken Capital Markets in Oslo. “The scarcity of available drilling equipment is causing delays and projects like Shah Deniz and In Amenas are in largely uncharted territory.” He rates Statoil stock “accumulate.”

Bloomberg