The government is proposing to sell companies which explore and produce oil and gas, with the aim to “reduce the vulnerability of our common wealth to a permanent oil price decline”.
Companies classified as exploration and production companies by the index provider FTSE Russell will be excluded from the Government Pension Fund Global’s (GPFG) benchmark index and investment.
The government does not plan to sell shares in the state’s Direct Financial Interest (SDFI) or in Equinor in order to reduce the state’s oil price risk.
It said in a statement: “The oil industry will be an important and major industry in Norway for many years to come. The state’s revenues from the continental shelf are, as a general rule, a consequence of the profitability of exploration and production activities. Therefore, this measure is about diversification.
“Exploration and production companies will be phased out from the Fund gradually over time and plans will be prepared in consultation with Norges Bank, after the Storting’s deliberation of the white paper, published today.”
Finance Minister Siv Jensen added it is anticipated almost all of the growth in renewable energy over the next decade will be driven by companies that do not have renewables as their main business – and the fund should be able to participate in that growth.