Statoil 'threatens Norway flag-out'

Tax disadvantage: Statoil chief Helge Lund

STEVE MARSHALL

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By Steve Marshall and news reports

 19 November 2012 09:56 GMT

Norwegian state oil giant Statoil is reportedly threatening to flag out its operations due to proposed changes in the domestic fiscal regime that could leave it with a huge tax bill.

The company, led by chief executive Helge Lund, stated in its recent third-quarter results report that it could face a one-off deferred tax charge  of Nkr2.3 billion ($398.5 million) as a result of new tax rules for overseas activities being proposed by Norway’s Finance Ministry.

Under the existing regulations, Statoil is able to claim tax relief on costly foreign exploration activitie,s while Norway is denied tax revenue from overseas fields that are brought into production.

The Oslo government therefore is proposing changes to the Norwegian tax system as it effectively sponsors the company’s overseas operations, according to business daily…

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