Norway

Norwegian petroleum tax

• Exploration refund: 78% of expenses related to exploration up to PDO are refunded year after spend
• The exploration can be financed through bank facilities with pledge in the tax refunds
• 30% uplift over 4 years (7.5% p.a) for capital expenditure on development projects
• Depreciation of capital expenditure: linear over 6 years
• Companies not in a tax position can carry forward their losses and the uplift with interest
• Marginal government take: 78%

 Petroleum tax calculation:

+ Operating income (norm price)

- Operating expenses

- Linear depreciation for investments (6 years)

- Exploration expenses, R&D and decommissioning

- CO2-tax, NOX-tax and area fee

- Interest cost *

= Corporation tax base (tax rate: 28 %)

– Uplift (7.5 % of investment for 4 years)

= Special tax base (tax rate: 50 %)

*deduction based on criteria defined in the petroleum tax act