Tickers in this Article: STO, CVX, CHK, TLM
Statoil (NYSE:STO) hopes to grow its production at a 3% compound annual growth rate over the next ten years and reach daily production of 2.5 million barrels of oil equivalent (BOE) per day by 2020. The company plans to achieve this goal through the aggressive development of domestic and international properties across its portfolio.

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Production Goals
Statoil reported production of 1.88 million BOE per day in 2010. The company's 2020 production target includes 1.4 million BOE per day from the Norwegian Continental Shelf, and 1.1 million BOE per day from the company's International portfolio, including 500,000 BOE per day from North America.

Capital Expenditures
Statoil estimates that the company will spend $16 billion in capital expenditures in 2011 and a similar amount in 2012 for exploration and development on its portfolio of assets.

Norwegian Continental Shelf
The Norwegian Continental Shelf is Statoil's core area and contains 50% of the company's resource base. The company is active in the North Sea, Norwegian Sea and Barents Sea and is targeting 700,000 BOE per day of new production from the NCS by 2020. This includes a contribution from future exploration by the company.

International
Statoil plans investments across the company's international portfolio of oil and gas projects. In North America, the company is targeting production of 500,000 BOE per day by 2020, and has established positions in both offshore and onshore basins in the United States and Canada.

Statoil entered into a joint venture with Chesapeake Energy (NYSE:CHK) in the Marcellus Shale and with Talisman Energy (NYSE:TLM) in the Eagle Ford Shale. The company prefers these two plays because of the economics of development here.

In the Gulf of Mexico, Statoil is involved with a number of projects, including the Jack and St. Malo discoveries. The company owns a 25% interest in this area, which is 50% owned and operated by Chevron (NYSE:CVX). Statoil has many other prospects in its portfolio and has obtained two permits to drill future prospects in the Gulf of Mexico.

Statoil is also active in other countries outside the United States and reported the majority of its international production in 2010 from Angola, Azerbaijan, Algeria and Nigeria. One major international project ramping up in 2011 is the Peregrino project located offshore from Brazil.

Statoil expects production here to reach a peak of 100,000 BOE per day in 2012, and the company is working on a phase two at Peregrino.

Canada
Statoil is active in the oil sands and started up production from the Leismer demonstration project in January 2011. This is part of the Kai Kos Dehseh oil sands project which is 60% owned and operated by Statoil. In 2010, the company sold 40% of this project to PTT Exploration and Production of Thailand for $2.28 billion.

In the offshore area, Statoil has interests in two producing fields located off Newfoundland. The company plans to drill three wells here in 2011.

The Bottom Line
Statoil is targeting compound annual production growth of 3% per year through 2020 as the company tries to reach its production goal of 2.5 million BOE per day. The company plans extensive development of its domestic and international portfolio to realize this goal. (For more, see A Guide To Investing In Oil Markets.)

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