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Oil & Minerals
Oil in Greenland

NOC’ed down

Greenland’s national oil company is downsizing

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If anyone knows the oil industry in Greenland, it is NunaOil, the national oil company (NOC). Set up in 1984 to attract investors, it, initially, was responsible first for gathering seismic data, an activity on which it turned a profit.

Of late, it has been an active, if mandatory, partner in exploration activities. These days it has less to do than it would like. Exploration activity in Greenland is less than what the Self-Rule Authority had projected, due to a prolonged price slump that has seen firms concentrating their efforts on making the most of lower-cost fields.

Instead of being a net asset for the Self-Rule Authority, NunaOil now survives on the money set aside for it in the national budget each year.

SEE RELATED: In Greenland’s oil hunt, all’s quiet on the western coast

The result, according to an announcement from the Oil and Minerals Ministry today, will be a reduction in the firm’s activities. Layoffs, including a possible reduction in the number of members of the board, are also in the offing.

“We’re not winding up the company,” Múte Bourup Egede, the oil minister, said. “It will continue to operate, but its size will be adjusted.”

The downsize, Mr Egede explained, should be seen as a readjustment that reflects the current market situation. The hope is that what gets knocked down can always be staffed up again.