Financial statements 2002 - Statoil

gc3MNaFPLh

Financial statements 2002 - Statoil

Statoil group – NGAAP Statoil group – NGAAP – notes Statoil ASA – NGAAP

34

Chief executive officer Olav Fjell received in 2002 a salary and other remuneration of NOK 3,770,000. No bonus was paid to the Chief executive

officer in 2002.

The board of directors will annualy assess a bonus to the chief executive officer. The assessment will be based on achieved performance.

Maximum bonus is 30% of basic salary. A performance pay system has been established for the other members of the executive committee,

senior vice presidents and vice presidents. This entails a variable remuneration based on pre-determined goals. The scheme allows for a bonus of

10% of basic salary on achieving set goals, with a ceiling of 20% for results that clearly exceeds these goals.

If resigning at the request of the board of directors, the chief executive officer is entitled to severance compensation equaling two annual

salaries. This also applies to executive vice presidents Erling Øverland, Inge K. Hansen and Peter Mellbye. The chief executive officer and these

three executive vice presidents are entitled, under specific terms, to a pension after reaching the age of 60. The pension will amount to 66% of

their pensionable salaries.

Executive vice presidents, Henrik Carlsen, Elisabeth Berge and Terje Overvik have interest-free loans of NOK 299,000, 71,000 and 386,000

respectively. These loans have been approved with a repayment period of 10 years.

For information regarding shares owned by corporate executive committee, the board of directors and the corporate assembly refer to note 23.

4. Significant Acquisitions and Dispositions

In 2001, Statoil sold specific interests in Norwegian oil and gas licenses and its activity in Vietnam which resulted in total gains of NOK 2.7 billion

before tax charges of NOK 0.4 billion.

In 2001, the Norwegian state transferred to Statoil some SDFI properties. The transferral is described in note 1.

5. Asset Impairments

Impairment tests of properties owned by Statoil ASA (the parent company) have not resulted in material write-downs in 2002 or 2001.

6. Restructuring and Other Charges

During the period 1995-1998, based on estimated future needs for exploration and production drilling services on Statoil-operated licenses in

the North Sea, Statoil, on a sole risk basis, entered into several long-term fixed-price drilling rig contracts. A decline in worldwide oil prices

resulted in reduced work programs for the licenses, and Statoil was left with significant excess drilling rig capacity in a depressed market for

drilling rig services. In 1998 and 1999 Statoil recorded as Operating expenses a total of NOK 1.6 billion for expected losses on these purchased

drilling rig service contracts. In 2001, NOK 150 million of the provision was reversed due to a reduction in the estimated losses on the contracts.

In 2002 the provision was increased by NOK 231 million due to higher estimated losses on the contracts due to changes in the estimated subcontract

market rates. Estimated sub-contract market rates were based on rates quoted by rig brokers, new drilling rig contracts entered into by

other oil companies and Statoil’s evaluation of drilling needs and drilling rig availability through the contract period. The remaining contracts

periods for the rigs last from one to four years. The accrual is Statoil’s best estimate of the loss between fixed-price drilling rig contracts and the

estimated sub-contract market rates.

At December 31, 2001 and December 31, 2002 the remaining provision for drilling service contracts was NOK 734 million and NOK 960 million,

respectively. During 2001 and 2002, NOK 76 million and NOK 5 million, respectively, of contract payments were charged against the provision.

These charges impact the Exploration and Production Norway segment.

7. Inventories

The lower of cost or market test is measured, and the results are recognized separately, on a country-by-country basis, and any resulting

write-downs to market, if required, are recorded as adjustments to the cost of inventories.

AT DECEMBER 31,

(IN NOK MILLION) 2002 2001

Crude oil 1,967 2,304

Petroleum products 864 463

Other 412 483

Total - inventories valued on a FIFO basis 3,243 3,250

STATOIL 2002

NOTES TO FINANCIAL STATEMENTS STATOIL ASA – NGAAP

Statoil ASA – NGAAP notes

To the Annual

General Meeting

More magazines by this user
Similar magazines