Finpro's Maritime Business Day seminar, February 10th 2016

1. The Norwegian Maritime-Offshore Market:
Opportunities for Finnish suppliers
Christian Svane Mellbye
Senior Analyst – Menon Economics

2. Agenda
1. The Norwegian maritime industry – overview and current market situation
2. Possibilities for finnish suppliers
3. Shipyards and offshore yards
4. Norwegian equipment manufactures
5. Norwegian shipowners
6. Oil and gas companies
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3. The Norwegian maritime industry -
overview
• Norway is home to one of the worlds leading maritime clusters
• The cluster employees more than 100,000 people and reached a
turnover of €65 bn in 2014
• We define the maritime industry as «All companies that own,
operate, design, build, deliver equipment or specialized services
to all types of ships and other floating units”
– That means that structures, equipment and services
delivered to fixed platforms are not included
• The oil supplier industry saw a turnover of approx. €75 in 2014
– €35 bn when excluding the overlap between the maritime
industry
• The whole industry is hit hard by the downturn in the oil & gas
industry
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4. Norwegian is home to a world-leading
maritime cluster
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5. All parts of the cluster have grown during
the last decade
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Value creation in the maritime groups in Norway (2013) and annual growth rate last decade. Source: Menon (2014)

6. The cluster have experienced a strong
growth the last decade
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7. Drilling equipment
Electronics and subsea equipment
Maritime services – financial, legal and
technological
Trøndelag:
National technological hub –
NTNU/Marintek
Number of maritime personell in
local communities in Norway
Regional specialization – local clusters
of maritime competence and business
The different maritime regions in Norway have specialized on
different products and services
1. The Oslofjord Region
– Oslo: Main offices for shipping companies combined with
specialized maritime services
– Kongsberg / Horten: Electronics and subsea equipment
2. Southern-Norway
– Dominated by drilling equipment
3. Offshore western Norway
– The Stavanger Region: Oil capital. Driling and production
services
– Haugaland/Sunnhordland: Offshore-oriented maritime
cluster
– The Bergen Region: Centre of industrial shipping.
Equipment production. Second most important area for oil
and gas supplier industry
4. The Maritime Cluster in Møre
– Design, construction, equipment and operation of offshore
vessels. Home to the larg yard groups
5. Trøndelag
– The National Technological Research Centre - NTNU /
Marintek
6. Northern-Norway
– The maritime activity is scatterd in the region – an Artic
maritime cluster in development
Maritime Møre
Yards, design,
fabrication and
operation of offshore
vessels
Offshore
Western
Norway
1
2
4
3
5
6

8. What business opportunities exists in
Norway ?
• The orderbook at Norwegian shipyards are approx € 3 bn in jan 2016
– Mostly offshore vesseles, but also fishing/aquaculture and passenger
ferries
– Approx. a third of the value of the vessels will be imported from abroad
– Relationships with yards and owners key: Need to have direct contact with
shipowners and/or be on the yards makerslist
• Norwegian equipment manufactures orderbook € 7 bn in 2014
• The shipowners in Norway controll the worlds 7th largest orderbook
• The offshore supplier industry in Norway is one of the largest in the world and
the Norwegian industry sources from all over the world
– Dependent on the companies size and service offered, there are
possibilities to become a direct supplier to the oil operators or a sub-
supplier to Norwegian entities
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Yards
Equipment
Shipowners
Oil & gas
supplier industry

9. Current market situation:
Falling activity & cost pressure
• Falling oilprice and falling demand leads to
overcapacity and cost pressure
– Yard orderbook down 15 percent from
2015-2016
– Rigg newbuild market is almost non-
existing
– Almost 20 % of the Norwegian offshore
fleet is laid up
• Norwegian supplier industry are able to take
advantage of the weak NOK
• Despite the downturn, the offshore market in
Norway is one of the largests in the world
• Increasing focus on ocean industries
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10. Yards: Norway is home to 40 shipyards, with
four dominating yard groups
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• The four main shipyard groups include:
– Vard (previously STX OSV) – 5 yards in Norway, 5 abroad
– Kleven – 2 yards
– Ulstein – 1 yards
– Havyard – 1 yard
• The shipyards mainly build offshore vessels (PSV, AHTS,
Subsea and seismic)
• The larger shipyards focus their activities in Møre og Romsdal
• The smaller shipyards focus on ship repair and delivery of
smaller vessels such as ferries, fishing vessles and specialized
vessels for the aquaculture industry
• In addition Aker Solutions (3 yards), Aibel (1 yard), Kvaerner (2
yards) and Westcon focus on offshore structures and rigs.
These yards are included with their logo on the map to the
right
4 shipyard groups
4 offshore yard groups

11. Yards: Norway is home to 40 shipyards, with
four dominating yard groups
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• The four main shipyard groups include:
– Vard (previously STX OSV) – 5 yards in Norway, 5 abroad
– Kleven – 2 yards
– Ulstein – 1 yards
– Havyard – 1 yard
• The shipyards mainly build offshore vessels (PSV, AHTS,
Subsea and seismic)
• The larger shipyards focus their activities in Møre og Romsdal
• The smaller shipyards focus on ship repair and delivery of
smaller vessels such as ferries, fishing vessles and specialized
vessels for the aquaculture industry
• In addition Aker Solutions (3 yards), Aibel (1 yard), Kvaerner (2
yards) and Westcon focus on offshore structures and rigs.
These yards are included with their logo on the map to the
right
Key area for
shipbuilding

12. The Norwegian shipyards current orderbook
• Current orderbook 62 vessels (larger than 40 m)
– Mainly offshore vessels, but the orderbook is more
diversified in the latest years since the contracting of
offshore vessels have slowed
– Meassured in value, offshore vessels still dominate the
orderbook of Norwegain Yards.
– 13 larger wellboats for aquaculture
• Over the last ten years, approx 75 % of newbuildings are
orderd by Norwegian owners
• Smaller yards include:
– Brødrene AA (ferriers)
– Båtservice Mandal (catamarans)
– Fiskerstrand (ferrier/aquacultur)
– Fosen Yard (repair, earlier offshore)
– Fitjar (aquacultur)
– Grovfjord Mek Verksted ( aquaculture)
– GS Marine (ferries)
– Larsens Mek Verksted (aquaculture)
– Moen Marine (aquaculture)
– Oma (passenger ferries)
– Promek (aquaculture)
– Simek (Offshore/Fishing)
– Sletta Verft (aquaculture)
– Stadyard (aquaculture)
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0
10
20
30
40
50
60
Offshore Aquaculture/Fishing Others
Number of vessels in Norwegian yard’s orderbooks jan.
2015/2016. Source: Norwegian Industries
2015 2016

13. Kleven Maritime - deliveries
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Vessels:
Offshore
Design:
Norwegian
Owner:
Norwegian

14. Kleven Maritime - orderbook
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Vessels:
Offshore, but more
diversified
Design:
Norwegian
Owner:
More diversified

15. Orders for ferries and passenger vessels
• Currently 15 small/mediumsized ferries and
passenger vessels in the orderbook
• Three key builders and NorYards (Bergen Group)
• Environmental focus with hybrid/batteri/alternative
fuels (ABB active among others)
• Owners are mainly Norwegian
• Could see increased attention from larger yards
Yard Owner Vessel type
Brødrene AA The Fjords Sightseeing
Brødrene AA Chu King Shipping 250 Passenger
Brødrene AA Chu King Shipping 250 Passenger
Brødrene AA Boreal Transport Nord 150 Passengers
Brødrene AA Boreal Transport Nord 150 Passengers
Brødrene AA Boreal Transport Nord 200 Passengers
Fiskerstrand Torghatten Trafikkselskap Ferry (Biodiesel/hybrid)
Fiskerstrand Torghatten Trafikkselskap Ferry (Biodiesel/hybrid)
Fiskerstrand Torghatten Trafikkselskap Ferry (Biodiesel/hybrid)
GS Marine Produksjon Nordland Fylkeskommune 50 Passenger/ 2 Car
GS Marine Produksjon Nordland Fylkeskommune 50 Passenger/ 2 Car
GS Marine Produksjon Nordland Fylkeskommune 50 Passenger/ 2 Car
Oma Baatbyggeri Boreal Transport Nord 70 passengers & 5 Cars
Oma Baatbyggeri Boreal Transport Nord 300 passengers
Oma Baatbyggeri Boreal Transport Nord 150 passengers
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16. The maritime equipment industry in Norway
• The maritime equipment industry in Norway can be divided in
two:
– Equipment for vessels and floating structures
– Drilling and offshore equipment mainly for oil rigs
• The first group is dominated by five large companies:
– Kongsberg Maritime
– Rolls Royce Marine
– ABB
– Framo
– Wartsila
• The second group is dominated by the three major producers
that have a 90 % global marketshare in drilling equipment
packages:
– National Oilwell Varco (inc. APL)
– MH Wirth
– Cameron Sense
• For more information download «Maritime equipment
manufactures in Norway 2015» from www.menon.no or look
at memberprofiles at Norwegian Maritime Exports
http://nmexporters.no/?page_id=63
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Equipment for vessels and floating structures
Drilling and offshore equipment mainly for oil rigs

17. Turnover for maritime equipment
manufacture and service providers in
Norway: € 25 bn
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100
110
120
120
120
130
200
270
280
280
290
300
350
730
1 010
1 050
1 350
0 200 400 600 800 1000 1200 1400 1600 1800 2000
BRUNVOLL AS
HARDING SAFETY/NOREQ AS
WÄRTSILÄ HAMWORTHY
MACGREGOR PUSNES AS
EUREKA PUMPS AS (PART OF ALIGN)
NORSAFE AS
MACGREGOR NORWAY AS (CARGOTEC)
BERGEN ENGINES AS (ROLLS ROYCE)
ALFA LAVAL (FRAMO FUSA AS)
WÄRTSILÄ OIL & GAS SYSTEMS AS
CAMERON SENSE AS
TTS GROUP
WARTSILA NORWAY AS
KONGSBERG MARITIME AS
ROLLS-ROYCE MARINE AS - MEKANISK/EL
MHWIRTH AS
ABB AS
NATIONAL OILWELL VARCO INCL. APL
Million €
Turnover for leading maritime equipment and service providers in Norway (2014)
5200

18. 5. Key shipowners
• Norwegian shipowners controll about 1800 vessels, the worlds 6th largest fleet
meassured in fleet value, and 7th largest meassured in DWT
• Historically they have placed a large part of their newbuildings on Norwegian yards
• Today, chemical tankers and deep sea vessels are built abroad, while approx. 75
percent of the offshore fleet is built in Norway
• Shipowners play a key role when selecting the equipment on the vessels and they
have a preferance for Norwegian manufactures
• Most of the deepsea and offshore shipp owners are organized in the Norwegian
Shipowners Association (www.rederi.no )
– List of members of the Norwegian Shipowners association (approx. 150 members
focusing mainly on offshore and deepsea) can be downloaded here:
https://www.rederi.no/om-oss/medlemmer/
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19. Most countries are specialised, with one
segment dominating the fleet
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20. Important Norwegian Owner Groups
Group Owner Owner/Comments
Number of
vessels Types of vessel
K. G. Jebsen
(KGJS)
Controlled by Kristian
Gerhard Jebsen and
family 51 Chemcial tankers
Leif Hoegh & Co Leif O.Høegh 51
Siem Offshore Kristian Siem 51 Offshore
Solstad Shipping Solstad Family 46 Offshore
Hurtigruten AS TDR Capitals 41 Cruise
Team Tankers
Prev. Eitzen Chemicals.
American funds 38 Chemcial tankers
Boreal Transport Also landtransport 38 Ferries in Norway
Grieg Star
Elisabeth Grieg &
family 36 Bulk
Bukser og Berging Tug/Offshore 35 Tug/Offshore
Nordic American
NATS Herbjørn Hansson 35 Oil Tankers
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Group
Name/Owner Owner/Comments
Number of
vessels Types of vessel
Fredriksen Group
John Fredriksen (London-based,
Cypriot national) 234
Offshore service,
drillships/rigs,
tankers and bulk
ships.
Stolt-Nielsen Stolt Nilsen (London-based) 89 Tankers
Wilson ASA
Controlled by Kristian Eidesvik -
listed on Oslo Børs. 84
Short Sea in
Norway and
Europe
Fjord1 AS
Owned by Sogn og Fjordane
county and Havila 83 Ferries in Norway
DOF Management
Møgster family - listed on Oslo
Børs 77
Offshore service
and subsea
Farstad Shipping
Farstad family - listed on OSLO
Børs 60
Offshore service
and subsea
Tide ASA
Controlled by Hermansen family
(Stavanger). Listed on Oslo Børs 59
Ferry's and land
transport in
Norway.
Torghatten ASA Listed on OTC-list on Oslo Børs 58
Ferry's and land
transport in
Norway
Odfjell ASA Laurence W. Odfjell 56 Bulk
Gearbulk Ltd.
Controlled by Kristian Gerhard
Jebsen and family 53
Oil Tankers,
Cement
Source: Clarkson/Menon

21. Important Norwegian Owner Groups
Group Owner Owner/Comments
Number of
vessels Types of vessel
K. G. Jebsen
(KGJS)
Controlled by Kristian
Gerhard Jebsen and
family 51 Chemcial tankers
Leif Hoegh & Co Leif O.Høegh 51
Siem Offshore Kristian Siem 51 Offshore
Solstad Shipping Solstad Family 46 Offshore
Hurtigruten AS TDR Capitals 41 Cruise
Team Tankers
Prev. Eitzen Chemicals.
American funds 38 Chemcial tankers
Boreal Transport Also landtransport 38 Ferries in Norway
Grieg Star
Elisabeth Grieg &
family 36 Bulk
Bukser og Berging Tug/Offshore 35 Tug/Offshore
Nordic American
NATS Herbjørn Hansson 35 Oil Tankers
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Group
Name/Owner Owner/Comments
Number of
vessels Types of vessel
Fredriksen Group
John Fredriksen (London-based,
Cypriot national) 234
Offshore service,
drillships/rigs,
tankers and bulk
ships.
Stolt-Nielsen Stolt Nilsen (London-based) 89 Tankers
Wilson ASA
Controlled by Kristian Eidesvik -
listed on Oslo Børs. 84
Short Sea in
Norway and
Europe
Fjord1 AS
Owned by Sogn og Fjordane
county and Havila 83 Ferries in Norway
DOF Management
Møgster family - listed on Oslo
Børs 77
Offshore service
and subsea
Farstad Shipping
Farstad family - listed on OSLO
Børs 60
Offshore service
and subsea
Tide ASA
Controlled by Hermansen family
(Stavanger). Listed on Oslo Børs 59
Ferry's and land
transport in
Norway.
Torghatten ASA Listed on OTC-list on Oslo Børs 58
Ferry's and land
transport in
Norway
Odfjell ASA Laurence W. Odfjell 56 Bulk
Gearbulk Ltd.
Controlled by Kristian Gerhard
Jebsen and family 53
Oil Tankers,
Cement
Source: Clarkson/Menon

22. 6. Oil and Gas companies
• 34 operators and 20 license owners currently in Norway
• Dominated by a Statoil and the large multinationals majors. In addition smaller Norwegian and
smaller foreign companies have been established the last 10 years.
• In the last ten years the number of companies active have almost doubled
• Pre-qualifications to become a supplier: Achilles
– http://www.achilles.com/en?cont=fi
• Statoils page on how to become a supplier:
– http://www.statoil.com/en/OurOperations/Procurement/HowToBecomeASupplier/Pages/def
ault.aspx
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Number of companies on the Norwegian continental shelf 2000-2014, by size. Source: Norwegian Petroleum Directorate

23. Big Projects
• Investments offshore are falling and the oil
and gas companies are focusing on cutting
costs
– This influences the majority of the cluster
in Norway. Both yards and equipment
manufactures are reducing capacity and
see short-term
– The Johan Sverdrup oil field is the big
excemption. Scheduled to start production
in late 2019. Investments expected to be
EUR 20-25 bn in the first phase
• The value of the shipyards orderbooks in
Norway is still more than 3 billion Euros in jan
2016
• Current ongoing focus in Norway to move goods
from roads to ships. Included in this is work is
expanding/changing the Norwegian port system
• Harbors with expansion plans: Moss (Borg havn),
Orkanger/Trondheim (early stage), Narvik (early
stage), Kirkenes and Svalbard.
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Investments in the oil and gas industry in Norway:
Historical numbers 2010-2015 and forecast 2016-2020. Source: NPD

24. Future activities on the Norwegian
Continental Shelf
• The list below includes discoveries where the authorities have approved the plan for development and operations
(POD). This means that the operators either have started offering contracts or have the possibility to do so in the
coming years.
– The list is organized by size of the remaining reservoir
• In addition contracts relating to current fields and satellitt fields are awarded constantly
• Statoil the most important oil operator
List of disoveries where the authorties have approved a plan for development and operation (PDO). Source: offshore.no
2/11/2016 © Finpro24
Field name Operator Status Remaining investments (mill Euro)
JOHAN SVERDRUP (1st phase) Statoil PDO APPROVED 12 105
AASTA HANSTEEN Statoil PDO APPROVED 3 608
GINA KROG Statoil PDO APPROVED 3 289
MARTIN LINGE Total E&P Norge PDO APPROVED 2 714
IVAR AASEN Det Norske Oljeselskap PDO APPROVED 2 600
VALEMON Statoil PDO APPROVED 2 007
GUDRUN Statoil PDO APPROVED 1 404
KNARR BG Norge PDO APPROVED 1 122
BRYNHILD Lundin Norway PDO APPROVED 525
BØYLA Marathon Oil Norge PDO APPROVED 511
SVALIN Statoil PDO APPROVED 474

25. Comments and questions can be sent to:
Christian Svane Mellbye
Senior Analyst
Menon Economics
christian@menon.no