Guide

Glossary: energy, the shelf and shipping

The terms you meet on the field pages, on the analysis page and in the news about energy and shipping, with the Norwegian term in brackets.

Updated 29 Sep 2026 · about 11 min read · Written by OESA

Shelf and resources

APA (TFO): Awards in predefined areas: the annual licensing round for mature areas of the shelf.
Appraisal well (Avgrensningsbrønn): Exploration well drilled after a discovery to find out how large it is and how far it extends.
Block (Blokk): Part of the map grid over the shelf. The shelf is divided into quadrants and each quadrant into blocks; wells and licences are tied to the blocks.
BOK, BOV and BOG (BOK, BOV og BOG): The authorities' three milestones before a development: the decisions to concretise, to continue and to implement. BOG is the investment decision, when the PDO is submitted.
Condensate (Kondensat): Light hydrocarbons that are gas in the reservoir but become liquid as pressure and temperature fall on the way up.
Contingent resources (Betingede ressurser): Recoverable quantities that have been discovered but not yet decided for production. Resource classes 4–7 at the Norwegian Offshore Directorate.
Decommissioning plan (Avslutningsplan): Plan the licensees must submit two to five years before the production licence expires, proposing what will happen to the installations.
Discovery (Funn): One or more petroleum deposits proven in the same wellbore, where testing, sampling or logging has shown mobile petroleum to be probable.
Field (Felt): One or more discoveries for which the authorities have approved a plan for development and operation (PDO), or granted an exemption.
FPSO: Floating production, storage and offloading vessel: a ship that receives, processes and stores oil from the wells and offloads it to tankers.
Licensee (Rettighetshaver): A company that owns a share of a production licence or a field. Pays its share of the costs and receives its share of the production.
NGL: Natural gas liquids: the heavier gases ethane, propane, butanes and naphtha, separated from the dry gas.
Norwegian Offshore Directorate (Sodir) (Sokkeldirektoratet (Sodir)): The government directorate for resource management on the shelf. Called the Norwegian Petroleum Directorate until 2024. Publishes FactPages and FactMaps.
Oil equivalents (o.e.) (Oljeekvivalenter (o.e.)): A common measure that lets oil, gas, NGL and condensate be added up. 1,000 Sm³ of gas counts as 1 Sm³ o.e.
Operator (Operatør): The licensee that runs the day-to-day work in a production licence or on a field: drilling, development and operations. Appointed by the ministry.
PDO and PIO (PUD og PAD): A plan for development and operation (PDO) must be approved before a discovery can be developed. Pipelines and onshore plants need a plan for installation and operation (PIO).
Production licence (Utvinningstillatelse): A licence granting exclusive rights to surveys, exploration drilling and production in a defined area. Often abbreviated PL.
Reserves (Reserver): Recoverable quantities that have been decided for production. Resource classes 1–3 at the Norwegian Offshore Directorate.
Reservoir (Reservoar): Porous, permeable rock with oil or gas in its pores, trapped beneath a tight rock.
Sm³: Standard cubic metre: volume measured at standard pressure and temperature so figures from different fields can be compared. 1 Sm³ of oil is about 6.29 barrels.
Subsea tie-back (Havbunnsutbygging): Development with wells and equipment on the seabed connected to a nearby existing platform or production ship, instead of a platform of its own.
Undiscovered resources (Uoppdagede ressurser): Oil and gas assumed to exist but not yet proven by drilling. Resource classes 8–9.
Unitisation (Unitisering): Coordination when a deposit extends across several production licences: the licensees agree on common shares in the deposit.
Wellbore (Brønnbane): The drilled path from the surface into the subsurface. One well can have several wellbores, for example sidetracks.
Wildcat well (Undersøkelsesbrønn): Exploration well drilled to find out whether a new structure contains petroleum.

Prices and economics

1P, 2P and 3P (1P, 2P og 3P): Low, best and high estimates of reserves under SPE PRMS: proved (at least 90 % probability), proved plus probable (at least 50 %), and proved, probable and possible (at least 10 %).
Alternative performance measures (APM) (Alternative resultatmål (APM)): Key figures not defined in the accounting standards, such as adjusted earnings, free cash flow and net debt. Companies must define them and show how they reconcile to the financial statements.
Backwardation: When futures prices for later delivery are lower than the price for delivery now. A sign of a tight market.
Barrel (Fat): Volume unit for oil: 42 US gallons, about 159 litres.
Barrels of oil equivalent (boe) (Fat oljeekvivalenter (boe)): Oil, NGL and gas added together and converted to barrels. Companies report production in boe per day; the conversion factor for gas is in the footnotes.
Breakeven price (Breakeven-pris): The oil or gas price that gives a project a net present value of zero at a chosen discount rate. Definitions vary between companies.
Brent: Benchmark price for light North Sea crude, in USD per barrel. The futures contract trades on ICE Futures Europe.
Capex and opex (Capex og opex): Capital expenditure (investments) and operating expenditure (running costs).
Contango: When futures prices for later delivery are higher than the price for delivery now. Common when supply is ample and storage pays.
Discount rate (Diskonteringsrente): The rate used to convert future cash flows into value today.
Free cash flow (Fri kontantstrøm): Usually cash flow from operations minus capital expenditure. The definition varies between companies.
Futures contract (Terminkontrakt): A standardised agreement to buy or sell at a fixed price for future delivery. The “oil price” in the news is usually the nearest futures contract.
Henry Hub: A gas pipeline hub in Louisiana and the main US gas price, in USD per MMBtu.
MMBtu: One million British thermal units, the energy unit US gas is priced in. 1 MMBtu is about 0.293 MWh.
NBP: National Balancing Point: the virtual gas trading point in the UK, priced in pence per therm.
Net present value (NPV) (Nåverdi): The sum of all future cash flows converted to today's value with a discount rate. A positive NPV means profitable at that rate.
Norm price (Normpris): The price Norwegian oil is taxed at, set by the Petroleum Price Board. For gas the actual sales price is used.
Reserve replacement ratio (Reserveerstatningsrate): The year's new reserves from discoveries, revisions and acquisitions divided by what was produced. Above 100 % means reserves are growing.
Special tax (Særskatt): An additional tax on income from petroleum activities. Together with corporate tax it gives a combined rate of 78 %.
TTF: Title Transfer Facility: the virtual gas trading point in the Netherlands and the most widely used gas price in Europe, in EUR per MWh.
WTI: West Texas Intermediate: benchmark for light US crude, delivered at Cushing, Oklahoma. Trades on NYMEX.

Shipping

AIS: Automatic Identification System: radio signals in which ships broadcast position, speed and identity. The source of the ships on the globe on the analysis page.
Ballast: When a ship sails without cargo, for example back to the loading area.
Baltic Dry Index (BDI): The Baltic Exchange index for dry bulk, calculated from time-charter rates for Capesize, Panamax and Supramax.
Bareboat charter (Bareboat): Hire of a ship without crew; the charterer operates the ship itself for the period.
BDTI and BCTI (BDTI og BCTI): The Baltic Exchange indices for tankers carrying crude and fuel oil (dirty) and clean products such as petrol and diesel (clean).
Bunkers: Ship fuel.
Charterer (Befrakter): The party that hires a ship or buys freight, for example an oil company, a trader or a mining company.
Deadweight (dwt) (Dødvekt (tdw)): How much a ship can carry in tonnes, including cargo, fuel and stores.
Demurrage (Overliggedager): Compensation to the owner when loading or discharging takes longer than the laytime in the contract.
Fronthaul and backhaul (Fronthaul og backhaul): For bulk carriers, a trip from the Atlantic to the Pacific (fronthaul) usually pays more than the opposite direction (backhaul), because the ship ends up far from the next cargoes.
IMO number (IMO-nummer): A seven-digit number that stays with a ship for life, whatever its flag, owner or name. Sanctions lists identify ships by it.
MMSI: The ship's nine-digit radio number in AIS. The first three digits show the country that issued the number, usually the flag.
Price cap (Pristaket): Introduced in December 2022 by the G7, the EU and Australia: companies in these countries may only provide services such as insurance, finance and shipping for Russian oil bought at or below the cap.
Shadow fleet (Skyggeflåte): Ships engaged in illegal operations to circumvent sanctions, evade safety and environmental rules or avoid insurance costs (IMO). Also called the dark fleet.
Ship sizes (Skipsstørrelser): VLCC, Suezmax and Aframax are crude tankers; LR2, LR1 and MR are product tankers; Capesize, Panamax, Supramax and Handysize are bulk carriers. See the freight market guide.
Ship-to-ship transfer (STS) (Skip-til-skip-omlasting (STS)): Cargo moved from one ship to another at sea. Common and legal, but can also be used to hide where the cargo comes from.
Shipbroker (Skipsmegler): An intermediary who matches ships with cargoes and negotiates the contracts.
Shipowner (Reder): The party that owns and operates the ship.
Shuttle tanker (Bøyelaster): A tanker that collects oil from production ships and loading buoys at the fields, holding position with dynamic positioning while loading.
TCE: Time charter equivalent: voyage income after voyage costs, converted to dollars per day so it can be compared with daily rates.
Time charter (Tidscerteparti): Hire of a crewed ship for a period; paid per day, and the charterer pays fuel and port costs.
Tonne-miles (Tonnmil): Cargo in tonnes multiplied by the distance carried. Longer voyages tie up more ships even if the cargo volume is the same.
Voyage charter (Reisecerteparti): Hire for one voyage; paid per tonne or in Worldscale, and the owner pays fuel and port costs.
Worldscale (WS): A table with a nominal rate in USD per tonne for each tanker route. The market quotes freight as a percentage of it: WS 100 is the table rate.

Installations, rigs and vessels

Acknowledgement of compliance (AoC) (Samsvarsuttalelse (SUT)): A statement from the Norwegian Ocean Industry Authority that mobile units in a ship register must have to take part in petroleum activities on the Norwegian shelf.
AHTS: Anchor handling tug supply vessel: tows rigs and floaters and lays out and recovers their anchors.
Backlog (Ordrereserve): The sum of contracted future revenue, roughly dayrate times remaining contract days.
Concrete gravity base (Condeep) (Betongunderstell (Condeep)): A fixed concrete platform that stands on the seabed under its own weight. Troll A is an example.
CSV: Construction support vessel with a crane and remotely operated vehicles (ROVs) for work on the seabed.
Dayrate (Dagrate): The price per day for hiring a rig or a vessel.
Drillship (Boreskip): A ship-shaped drilling rig with dynamic positioning, mostly used in very deep water.
Dynamic positioning (DP) (Dynamisk posisjonering (DP)): Computer-controlled thrusters that keep a vessel or rig on the same spot without anchors.
Jack-up (Oppjekkbar rigg (jack-up)): A rig with legs lowered to the seabed while the hull is jacked up above the water. Only for shallow water.
PSV: Platform supply vessel: carries equipment, drilling fluids, fuel, water and food between shore and the installations.
Semi-submersible (Halvt nedsenkbar (semi)): A floating rig or platform standing on columns above pontoons below the waterline, held in place by anchors or dynamic positioning.
Spar: A tall, cylindrical floating platform with a deep draught. Aasta Hansteen is a spar.
Steel jacket (Stålunderstell (jacket)): A lattice of steel tubes standing on the seabed, fixed with piles, with the platform deck on top.
Tension leg platform (TLP) (Strekkstagplattform (TLP)): A floating platform held down by taut tendons fixed to the seabed, so it hardly moves up and down.
Utilisation (Utnyttelsesgrad): The share of time rigs or vessels have paid work. Companies define it differently.

Gas and climate

Bottom-fixed and floating offshore wind (Bunnfast og flytende havvind): Bottom-fixed turbines stand on foundations on the seabed in shallower water; floating turbines are moored and can stand in deeper water.
Carbon capture and storage (CCS) (CO₂-håndtering (CCS)): Capture of CO₂ from industry or gas production, transport by ship or pipeline, and storage in rock deep below the seabed.
EU Emissions Trading System (EU ETS) (EUs kvotesystem (EU ETS)): A system in which companies must hold an allowance for every tonne of CO₂ they emit. Companies on the shelf also pay a CO₂ tax.
FSRU: A ship moored in port that works as an LNG import terminal: it stores the cargo and turns it back into gas.
Gassco: State-owned company that operates the gas pipelines from the Norwegian shelf, the processing plants and the receiving terminals, and steers the gas flow.
Gassled: A joint venture that owns most of the gas infrastructure from the Norwegian shelf: pipelines, processing plants and receiving terminals.
LNG: Liquefied natural gas, cooled to about −162 °C so that it takes up about 1/600 of the volume and can be carried by ship.
Power from shore (Kraft fra land): Electricity by cable from the onshore grid to the installations, instead of power from gas turbines at the field.
Receiving terminal (Mottaksterminal): A plant where the gas pipelines from the shelf come ashore, for example Emden, Dornum, Zeebrugge, Dunkirk, St Fergus and Easington.
Rich gas and dry gas (Rikgass og tørrgass): Rich gas contains NGL as well as methane. Dry gas is what is left once the NGL has been removed, mostly methane.

Sources

The guides are written by OESA students to explain concepts and how things fit together. They are not investment advice. Figures that are not definitions carry a source and a date; if you find an error, let us know at philipstave@oesa-global.com.