Norway’s first offshore licensing round in 1965 embraced 278 blocks in the North Sea. Groups of companies were responsible for most of the 11 applications received, with Norwegians involved in two of these. Norsk Hydro was a member of the Petronord group with two French oil companies, while Norwegian Oil Consortium A/S & Co (Noco) – the first wholly private Norwegian oil company – participated with Amoco, Texas Eastern and Amerada in the AmocoNoco group.

Noco confirmed in a telex to Amoco on 28 April 1965 that the two would jointly apply for production licences on the Norwegian continental shelf (NCS). That marked the end of the consortium’s wide-ranging search for an international partner. An offer from Phillips Petroleum which could have made Noco a part-owner of the huge Ekofisk field came a few hours too late, after the decision to join forces with Amoco had been made. Oil exploration on the NCS at that time was a lottery. Although seismic surveys gave some clues about the location of promising areas, nobody knew which acreage they would get and what was to be found beneath the seabed in the various blocks.

American International (Amoco) created a Norwegian armin 1965. This was intended to comply with the country’s requirement that companies wanting to participate actively in future drilling off Norway had to have a local presence.

Negotiations on a division of the North Sea were still under way between the Norwegian and Danish governments when Norway awarded its first production licences in August 1965. The boundary with Denmark was still only temporary.

Applications were submitted by the AmocoNoco group for 40 of the 278 blocks put on offer in Norway’s first offshore licensing round, and was awarded 10 blocks in three production licences. It also received two further blocks in December 1965. Two of the blocks secured by the consortium were among the most interesting in the first Norwegian round – 2/5 and 2/8. Discoveries in this acreage were to include Tor, South-East Tor and Valhall.

The AmocoNoco group began drilling well 2/5-1 at the southern end of Norway’s North Sea sector on 1 August 1970. Oil and gas were proven at 3 972 metres beneath the seabed before the well was plugged and abandoned on 22 November. This discovery lay close to the Ekofisk field and was named Tor. Although not large, it could be brought into production as part of the development of the Ekofisk area. Finding oil gave a substantial boost to the self-confidence of the group, and its Norwegian industrial and shipping members felt they were now strong enough to manage without foreign partners.

Amoco Norway Oil Company moved, like a number of other oil companies, from Oslo to the Stavanger area in 1974. The aim was primarily to improve contacts with the recently established Norwegian Petroleum Directorate (NPD) and state oil company Statoil, and with licence partners. Offices were leased at the Aker Norsco base in Tananger.

Hod was discovered in 1974 with the second well in block 2/11, which found both oil and gas. The Storting (parliament) gave the green light to bring it on stream in 1977, at the same time as the Valhall development was approved. Hod nevertheless first began production in 1990. The question is why it took so long to develop this relatively small field.

Finding Hod and Valhall was more closely linked than one might suppose. Amoco had caught whiffs of both fields before Phillips Petroleum made the nearby Ekofisk discovery, but it made its breakthrough only came after the latter had begun production. And that was after something pretty close to espionage by Amoco.

The first application from the AmocoNoco group for official consent to develop Valhall and Hod was submitted on 4 October 1976, and welcomed with enthusiasm by the Ministry of Industry.

International tanker shipping had been a growth industry in the postwar years and was enjoying a fantastic boom in 1973. High freight rates meant good profits for shipowners, and worldwide orders for new crude oil carriers corresponded to 55 per cent of the existing fleet.

The various licensees on Valhall had different starting points for funding its development. Operator Amoco Norge as well as Amerada Hess and Texas Eastern were backed by international parents for part of their contribution, but also needed to borrow. Noco had no money and would have to cover its whole share with loans. The question was who could lend money to the oil companies for such huge investments. Were opportunities available in the Norwegian market, or would the borrowers have to go abroad?

Norwegian politicians long considered the model with one state-owned, one part-state-owned and one private oil company to be ideal. As the last of these enterprises, Saga Petroleum was assigned an increasingly important role in Norway’s offshore sector during in the early 1980s.

The blend of water, oil and gas flowing in liquid form from the Valhall wells must be treated with a range of processes before being exported from the field. The various components in this wellstream must be separated from each other and processed differently in order to meet the specifications set for them. Equipment on the original process and compression platform (Valhall PCP) was designed to handle outputs which could range on a daily basis between 168 000-60 000 barrels (26 700-9 500 cubic metres) of oil and six to 9.9 million cu.m of gas.

Valhall began production on 1 October in 1982, making Amoco Norway Oil Company – as operator for the Amoco group – the fourth company to bring a field on stream off Norway.

Only one well had been completed when Valhall began producing on Friday 1 October 1982. Production from the field initially failed to go as planned – an experience which was to be repeated.

The obligation to pay a royalty to the government on production from Valhall was abolished on 1 January 2000. That marked the end of an issue which had been a source of much contention, several legal actions and, finally, compromises between the authorities and various oil companies – including Amoco.

The Norwegian fiscal regime for the offshore sector was no more onerous than in other oil-producing countries when the first licensing round was held in 1965. By the early 1980s, however, the tax burden on the industry had risen to a record 85.8 per cent. Amoco Norway was then one of the oil companies which led the way in expressing the strongest dissatisfaction with the level of Norwegian taxes.

Var skattenivået i Norge verre enn i andre oljeproduserende land? I utgangspunktet, ved utlysningen av første konsesjonsrunde, var det ikke det, men ved begynnelsen av 1980-årene var det steget til rekordhøye 85,8 prosent. Flere av de internasjonale oljeselskapene likte dette dårlig. Hvordan hadde det skjedd?

Norwegian Oil Consortium (Noco) achieved its first ever good financial results in 1989. Production from Valhall was going well, with the well problems overcome, and oil prices were rising. The company was a money machine, according to the press. So it might seem strange that Noco’s owners resolved in August 1990 to sell the whole company. But they had several motives for this action.

Norway’s oil industry was in a depressed state during the early 1990s. Development on the Norwegian continental shelf (NCS) had stagnated, and hopes of finding big new fields were gone. Moreover, the sector’s vulnerability to international economic cycles was exposed when oil prices slumped to a historic low in 1986.

Great efforts were devoted by Amoco Norway around 1990 to restoring a positive spirit in company. After the difficult period with the initial problem wells on Valhall, the 1986 oil price slump and high staff turnover, the curves were climbing again.

The Valhall WP wellhead platform was installed as part of the field centre in 1996 in order to increase the number of well slots while permitting deviated drilling towards the flanks. Also called extended reach drilling (ERD), this technique involves deviating the well path away from a vertical line at an angle which can be steadily raised as drilling proceeds. But ERD is difficult to implement on Valhall because of its reservoir structure, where the thickness of the formation rocks varies considerably.

Amoco and BP announced their nuptials on 11 August 1998, unveiling the world’s biggest industrial merger until then. But the news took the employees in both companies completely by surprise.

One of history’s biggest industrial mergers was announced on 11 August 1998 by British Petroleum (BP) and USA’s Amoco. The two sides had managed to keep their extensive negotiations secret. Worth almost USD 840 billion, the new group was one of the world’s three largest oil companies along with Exxon and Shell. The market responded positively, with BP’s share price jumping 15 per cent and Amoco shares also seeing a rise – at a time when a fairly gloomy mood prevailed in the global oil sector. Crude oil prices had dropped to USD 10 per barrel, their lowest level since the dramatic slump of 1986.

The Valhall field centre was completely modernised during the 2000s. This partly represented a response to seabed subsidence on the field, with new platforms installed on its flanks. The installations were connected to the electricity grid on land, making them much more environment-friendly. And a permanent seismic array was installed on the seabed to improve reservoir surveillance. Last but not least, a control room established at BP’s offices in Forus outside Stavanger made it possible to monitor all aspects of production and processing much more effectively than before.

BP Norge initiated yet another set of changes around 2000 to reduce operating costs. Through the Offshore People Strategy (OPS) and GO for the Future (GO4F) processes, the company sought to safeguard its presence in Norway by tailoring costs, expertise and staffing.

Seabed subsidence on Ekofisk was first observed in the autumn of 1984, when its installations were clearly lower in the water. The same phenomenon was also found on Valhall, and action had to be taken to counteract its effects. The problem was most obvious with the Ekofisk tank. It was easy to see that more of the rows of holes in its concrete breakwater had become submerged than when it was first installed.

BP installed a permanent seismic survey network on the seabed in 2003 in order to monitor the Valhall reservoir and thereby improve recovery from the field. This “life of field seismic” (LoFS) installation represented the first full-scale facility for tracking changes in a sub-surface formation, and offers several benefits.

Hess Norge AS has been the majority licensee for Valhall and Hod since 1 January 2010, with 64.05 and 62.5 per cent respectively. Operator BP Norge AS has 35.95 and 37.5 per cent.

A blaze which began on the Valhall process and compression platform (PCP) in 2011 was extinguished in 97 minutes. Fortunately, nobody was hurt.

The Valhall field at the southernmost end of the Norwegian continental shelf (NCS) was discovered in 1975 and came on stream in October 1982. Recoverable oil reserves were initially calculated to be 247 million barrels, with production expected to last for roughly 20 years.

The Valhall redevelopment (VRD) project was launched in the early 2000s after it became clear that the field would stay on stream for much longer than initially anticipated.

A new combined production and hotel (PH) platform was installed for various reasons – as described in a separate article – on Valhall in 2012.

Valhall became the first field on the Norwegian continental shelf (NCS) to base its power supplies exclusively on hydroelectricity transmitted by submarine cable from land. Completed in 2013, this groundbreaking project has attracted much attention. Pertinent questions include which decisions underpinned BP’s technology shift, how the new development on Valhall proceeded and which other fields have opted for power from shore. Another issue is what environmentalists think of such a solution.