Investment in Norway's all-important oil sector is set to decline until 2019 as producers face high costs and collapsing oil prices, a government agency said on Thursday.
After investing a record level of about 180 billion kroner (18.7 billion euros, $20.4 billion) in 2013 and 2014, investments -- barring activities in exploration -- fell around 16 percent last year.
"They are expected to continue their decline going forward, followed by a moderate increase from 2019," said the Norwegian Petroleum Directorate, a government agency that helps manage and regulate oil sector activities.
With global oil prices plunging due to a supply glut, oil companies worldwide are slashing their investments and delaying or cancelling the development of certain projects that are no longer profitable.
Norway's oil production is also expected to fall from a record high of 1.57 million barrels per day (bpd) last year to 1.38 million bpd in 2019. A slight rebound of 1.40 million bdp is anticipated in 2020.
"Activity will remain high in the years to come, despite the decline since 2014. Therefore, it is important that companies make wise decisions and keep a long-term perspective," said petroleum agency head Bente Nyland.
Norway's economy is heavily dependent on the oil sector which accounts for more than 20 percent of its gross domestic product.
The slowdown in the oil sector has already led to the loss of 30,000 jobs since January 2014 and the Nordic country's current 4.6 percent unemployment rate is the highest in a decade.