Exploring Norway's Oil Industry and Governance

Norway is one of those countries whose story is interesting to us. It is an oil country that is doing well. Norway is now a rich country in terms of many quality of life and quality of governance standards, and these are exemplary. Indeed, many countries in the world are curious about it. Since it is an oil country, we are also curious. More than that, a country that is a neighbor of Russia in Scandinavia and is a founding and effective member of NATO, the Secretary General of NATO, the former Prime Minister of Norway, is a relatively young country that is 100 years old and has almost become independent. It was 100 years ago in Sweden, 400 years ago it was in Denmark, and now the country has been independent for more than a century. It is not without problems, no country is without problems, Norway has many problems in many places and many of its systems, but many things like its social security system, such as its comprehensive insurance , or the readiness of its economy and its institutions for the coming decades, are truly regrettable, not only for distant countries , but even for its neighboring countries . It is close to it geographically and close to it in the graphs. If we look at the table of many indicators, Norway is at the top, and this shows that the country is being run well. This is another sign that the country is probably being run well. When it is high for a long time, why is it being run well? how are you Well, because they have oil, they have oil, sir, Norway has a lot of oil and gas, the population is also small, you know that this prosperity and prosperity is not such an art at all, it does not need a special art, everyone likes to do this, everyone knows how to do this, it is not money, money OK, everyone can, especially oil money, oil oil, a lot of people, and a small population. In this video, we want to see how true this statement is, in fact, we want to see how false this statement is. It won't last even a minute longer, and then we want to see the rest of it, so if This is not what is the story? Now, talking like that is fine for the barbecue and when peeling oranges and for example in the cafe and so on. We want to talk a little more precisely. We spent a little time and researched. I think it is worth spending this one hour on one of the most important topics that Our contemporary history is also relevant. Let's be a little more informed. I think maybe then we can better understand something like these charts, why is this chart that shows how much oil per person each Iranian or Norwegian or Venezuelan has in these countries. They have gas , and then this graph that shows the GDP per person of each of these countries, Venezuela , Iran, and Norway, how much is the difference per population . I said, so what's the story? The story is that Norway managed its oil, the simple answer is that Norway knew what to do, others didn't, for example, but why did Norway know? What did he know at all? How did he know? How did he learn what he didn't know? If he knew, why did he go down a path for 20 years that led to inflation and the bursting of the housing market, and then he went down another path , where the questions become more interesting and the answers require a little more work, a little curiosity and a little time and research and better questions and questions We did a little bit of research like this. I myself lived in Norway for a few years. I have some experiences. I heard and read and saw some things . Of course, in this research I realized that many of the things I read, heard and saw were incomplete and many were simply wrong. People, the things I had heard are the same. People sit down and talk the same way in these conversations and chats. Some really crazy things. I also heard from people who I thought were not crazy people, but now I understand that the words were not accurate. The story of Norway. We want to say , for example, in the last 100 years or 150 years, not the way we usually read in history books that there was this king and he fought and so and so happened, and we did not go to Norway with a question, what did Norway do that made oil so good for it? And for the answer, we want to go see that How is Norway and when did it become oil? And what was before it? And then, when he became an oilman, what did he do that was different from the rest of the world? Oil was found in Norway in the 1960s. The end of the 1960s will be 1969. The end of the 40s is 60 or 70 years later than Iran and Norway. Before oil was found, there were no poor people and there was no news of this wealth and prosperity , but they were not poor either in the development path. Let's look at the same GDP per capita graph for the 19th century. We can see that in 1870, Norway is at the level of countries like Finland, Italy, and Spain, and it is lower than the leading economies , but it is far better than somewhere like Portugal, than Eastern Europe, better than Mexico, Latin America, and Asian countries. And this is better, it is not the premier league of the world's economy , but it is wrong to think that it was poor, while in the second half of the 19th century it was industrializing and falling on the path of development. How is the second half of the 19th century much better than the first half ? If we want to tell the story of any country, we have to look at its geography. If we don't know a few basic questions about its geography, we ca n't answer the rest of our words about that country. It's very possible that geography is a very boring subject for me. Now it has become an interesting subject for me, it has become an interesting subject. Let's see the geography of Norway. Norway is a relatively long country with a long coastline and wide mountains. Its area is not small, but only a small part of this land is habitable. Maybe that is why its geography is so small, its climate is like this. It's hard to see, for example, Norway next to Japan, they are a bit similar in shape and size, and they are both mountainous, but if you put the two countries together, you have more than 20 Japanese people for every Norwegian, which means that the population is spread out a little in this big land. In general , agriculture can be done on less than 3% of the land, that is, if you look at Armenia, the area of arable land is the size of Norway, Armenia, which is 12 times smaller than Norway, can fit 12 times as much as Armenia in Norway , but their agricultural land is equal to each other, and its land is scattered and small. That is, it is not a suitable country for agriculture, so what did they do all these centuries when there was not much else to do except agriculture. This geography, which makes agriculture so difficult, also gives Norway opportunities, like what? Like if you look at it, it was practically impossible to go from eastern Norway to western Norway or from northern Norway to southern Norway on the same west bank for centuries , with these high rocky mountains and these deep fjords, and this was really geographical determinism, which prevented development from many points of view. It would have been difficult to connect these at all. Even today, Norway is not considered an advanced country with a wide network, even compared to its Scandinavian neighbors Sweden and Denmark, so how are these cities and habitats connected? Or the city or not, how are these dozens and these connected to each other? To be connected with what? From the water route, with so many fjords or fjords, Norway has a very, very long coastline. Look at Norway next to Britain. Norway is not an island that is surrounded by water, but how many times do you think the coastline of Norway is the coastline of Britain? Five times because of all these indentations and these fjords that come to the middle of the land, what does this mean? It means that it is true that Norway is a mountainous country like Iran and Afghanistan, its people lived separately from each other until before the railway came , it was very difficult to carry a heavy load from one place to another place, but in Norway everything was at the edge of the water. Or it was the mouth of a river that flowed into a fjord that was somehow connected to each other, so transportation was possible, that is, it was possible to go from one place to another in this fjord, and it became practical. The improvement of this geography created a need, and in response to that need, Norwegian society became one of the leaders in the shipbuilding and seafaring industry from ancient times to today . Being masters of building ships with which they can go on long journeys in the middle centuries, a few centuries before Christopher Columbus and others reached America, the Vikings went to Newfoundland to reach the territory of the New World , or from this side of the Russian side of the Volga. We told the story of the Hansa League in the Middle Ages in the North Sea in the Baltic with cities in England, Germany, the Baltic, and Russia today, and this all shows that it is good on the ship and in the sea . Being ahead in the age of discovery, whenever we read the story of explorers, we come across Norwegian names, people who either pioneered the way themselves, were pioneers , such as Nansen, Amunsen, Norway had many of these people , or people who built ships . Bekhare comes to the Norwegian shipbuilders or even when he was in Antarctica when he was in Antarctica , when he was tired and exhausted after a few weeks of wandering in the mountains of Antarctica, he went to a place on the island of South Georgia because he knew that there were a group of Norwegians who What does it mean that they are hunting whales here and there ? That is, the Norwegians have had a good shipbuilding and seafaring industry for centuries before Norway existed, so much so that Norwegian ships used to go to faraway waters and work there. In Norway itself, there were these rivers and fjords, and the ships used to go and come in these and this. It helped them to export their timber from other European countries, even countries with more forests than Norway , Sweden, Russia , but the Norwegians, because their sea transportation network was established, that means they could get access by boat, they could take the trees deep into the forest. They should carry a lot of nets , put them in the same river for export, let them go down to the fjord, their exports were very high compared to their share of European forests in the 19th century. We want to see what Norway was like when it got oil. This is the century that Norway is becoming industrialized. Again, its geography helps it. Norway is full of rivers and mountains. When the water comes down from the mountains, it means Norway's energy has free access to all energy sources. That's the energy that they didn't know then, we appreciate it more now because it's renewable energy, clean energy, so to speak, all these waterfalls, all the water that comes from a height means energy, that means electricity, these trees that are cut down in the river, they come down there, there's a sawmill down there that uses its energy. It was taking from the same river, that is, that river was doing two big things for them for free, both transportation and supplying energy to the sawmill, and thus Norway's timber exports were very high. It was becoming industrialized from the end of the 19th century . I say that they could build a lot of factories in many cities of Norway, there are factories by the river and then houses for the workers, and then the place grew and grew. Cheap energy helped industries like aluminum and these to grow . There are many forests in Norway, for example papermaking and now manufacturing. Wood and timber, as we said, of course, most of the people are still not in industry, most of the people are still in agriculture and fishing, but now with this cold and hard weather, there was no special agriculture, but it was the same, and then cod and herring fishing are the main exports. There was fish and marine services and navigation, but let's not forget that they are not poor, in terms of per capita wealth, we said here, it is by no means one of the poor countries in Europe, Norway is even rising, but life is hard, life is really hard . Canada goes to America, rural, generally scattered, decentralized population , hard to reach The roads are very poor and this continues until the beginning of the 20th century. It is still not a poor country. Three decades or four decades in the 20th century before the Second World War started, Norway's situation is this in terms of GDP per capita. Before the war, it was one of the Why is it the highest in Europe ? For the same reasons as I said in the first decades of the 20th century, hydropower plants, rivers that create energy, damming and development of the hydropower industry, this is what happened in the first half of the 20th century, they built hydropower plants in such a way that since 1950, more than 95% of the total electricity consumed in Norway It is supplied from hydroelectric power plants , of course , the hydroelectric industry still exists and is being built, and it is gradually increasing its production . Electricity is the new energy. Everything that was done before is now going to be done with electricity, including the most important one in energy industries such as aluminum, energy industries such as aluminum , which have been relying on hydroelectricity since that time until now . What is the result? The result is that Norway is one of the biggest producers of aluminum in the whole of Europe from that time until now . Except for this, of course, now they are spending on research and development and some industries that they thought could be future industries are working on nuclear energy, telecommunications, communications. and the defense and military industries, and these were the things that they thought the future had, the way they worked, look again, this is not something that a poor, backward country wants to do . He was poor until oil came , which is clearly a wrong statement, not true, society, but how was his condition? Now, by society, I mean, what kind of people are people? Being a people who were literate to a good extent, especially now the Lutheran Church also played a big role in this expansion of public education and making the society literate very soon, very many of them were literate . In Norway, there is almost no illiteracy anymore, there is a big difference between 50% and 100%. This is just 1979, 1957. Before the revolution , before the discovery of oil, the state of literacy in Norwegian society was good. The society was literate to a great extent. It is constitutional , it is a government that still exists, its system is its government system, in fact , since before the discovery of oil, before the Norwegian governments became rich, they also have welfare policies . This is not the case, both Norway had extensive welfare policies before oil, and other Scandinavian countries that do not have oil have this. It is a model of the welfare state implemented by the Nordic countries, which is really not similar to it in the whole human experience, or very, very little. It is a system and an institution. Even if it is traditional, he was able to come to the aid of those who need help the most, to those who bring bad luck in life, and help them in this way, so that it is so widespread, something that cannot be done without the government, and they were able to do this with this model. Their welfare governments should do it now, in different ways, this is one of their values since then, before the talk of oil in the middle of the 20th century, there should be less inequality, it is one of the things that Norway is pursuing, of course, it was already like Sweden and this was not even there, for example, not having too much distance between people at all. Norway does not have a very big and strong aristocracy, like other European countries , or even Sweden, which is like that, is similar to Sweden and Norway in many ways , but this is a difference. In Sweden, there was little difference between the people, but in Norway it was very little, and the economy was in many places. We call it a cooperative, like a factory whose workers own shares, an economic model . A farm where all the farmers who work the same way own it, common ownership and a kind of democratic administration and make decisions together and share the profit and loss together, and small units of sparsely populated villages with very little capital, for example, the shipping industry was collected in the hands of a few people From the beginning, it had a cooperative nature, and later , other industries were established in Norway based on these cooperatives, from agriculture to animal husbandry to marine insurance to fisheries to financial institutions . I had read it scattered and it stuck to me , I mean, I didn't understand this point because this is a special kind of business, a kind of business that requires people to have high trust in each other, and of course, the result is good and successful. The point is that people's trust in each other increases and it becomes interesting when we understand that trust is one of the most important values of Norwegian society, they are aware that they have to keep it high and it is one of the components that we see has been important and they are proud of it even today . They take care of it and are sensitive to its decrease, such as equality , the welfare system , such as social democracy, such as nature-loving, such as cooperation , such as the things we talked about once before in another video in building a new Norwegian culture , of course, the Protestant ethic, which he also mentioned before. We talked, it was a strong foundation in shaping the culture of the society, and it helped them again. This does not mean that this society does not have anything negative, it means that because of this history and this geography, which has threats and opportunities There have been negative things and there have been positive things. How was he able to write the story of his own progress and find his own way through trial and error? World War II, as we know, Norway was occupied, that is, Nazi Germany came and took Norway, war and destruction, and these things after the war as well. It was one of the countries that went into reconstruction with the help of the US in the Marshall Plan, including strengthening the system of the welfare state and social democracy , which had a dominant political culture since the beginning of the 20th century . Oil is being found. I had heard the story of oil in Norway before , but since the discovery of oil, I did n't know its previous history, so I didn't really understand what happened when the Norwegians found oil. Not going? Why not go the way of England? Because the only way to go was not what to do now , but the only way was not that and I couldn't find a good answer for it because I didn't know what the Norwegian society had experienced before oil, and when it came to the story of oil, based on that What experiences did this model have? Let's go back to the industrialization of Norway, how did it become industrialized? With the hydropower industry with power plants and dam construction and so on , how do you start building dams and power plants and so on? It is something that needs capital, which Norway did not have , and technology, which was not in Norway, what to do? It was a problem that had to be solved. Norway was involved with this problem for half a century. It was investigating solutions and trying and making mistakes. And this experience in working with foreign companies in working in an industry where you have the resources but the capital and technology for its development. Did n't you have a model for managing the new Norwegian industry or the Norwegian oil industry ? A very important example was this scoring system, giving points like the points that we say during the Qajar era, they gave tobacco points, such points mean that when they were working in the water industry, they used a scoring system , which later when they started oil first with The same model of moving forward What was this system based on? Sir, these resources that are natural are here in Norway, they all belong to all the people, they belong to the government , which represents the people and should be developed in such a way that the benefits for the people are maximized . I say that the government of Norway and the government of Iran, for example, are similar to each other, they are both constitutional kingdoms , but the mistakes are practically limited to the same paper in Norway, both in practice and in the eyes of these resources . It should be exploited and used for the benefit of everyone. Don't look at oil like this everywhere. If we look at what England did with American oil, what did Denmark do with oil ? He looked, there is another thing here that is interesting to me, I think it is related, I didn't read this somewhere, it occurred to me that if there is something in common, I understand that there is something that we are many, many people who are very different from each other. We all own it, we don't agree on anything , but this belongs to us, we have to do something to ensure that the interests of our pair are guaranteed. When we say that oil, water, or natural resources belong to everyone, there is a similar thought behind it so that the society can To deal with such a thought, to understand it and implement the necessary equipment, one must really have an understanding of this. We can see the history of this understanding in the work they did centuries ago , for example, see how ship building was done in Norway. They wanted to build a very big ship. It was a difficult job, we are talking about big companies and they are not in the business, a lot of work has to be done, how do you build this? We say that they are building a partnership, not a private joint-stock company, a kind of cooperative, for example, in many places in Norway, every city, every place, every village works together to build this ship or to build these ships . One meaning is that it will benefit all of them, the work orientation that works in shipbuilding, the suppliers who each have a piece of work, they have a piece of equipment, they build, they are all partners, the old ones , or let's say the Hansa League, whose story we told at once. In the middle centuries, from the time of Genghis Khan, we said that they were working together in partnership with different cities in countries that are not now one, including a city in the west of Norway. They were cooperating with others to define common interests . Creating a co-op together, working together, this is working with others for common interests, which is not easy for everyone, it takes practice, we already know this, the tradition is not strong in our society, so the skills of working together in our temperaments, there is not much room for their cultivation. It was found that there was no priority for them, because we really didn't need everyone to do their own work, and as a result, even now in the 20th century, we see that we are not good at many of these skills. Defining a common goal is a bit difficult for us to compromise, and it is difficult for us to accept at all. That we are different from each other and this is completely ok, this is not very comfortable for us, it is not very comfortable for us, many times and this unfortunately shows itself in many places . Naturally, it belongs to everyone, and when in the late 19th century and early 20th century, big foreign investors came to buy these waterfalls and build a hydroelectric power plant here, with the same common understanding, the Norwegians went to them, looked at them and said, this is common property, this belongs to everyone, we can't sell it , we can We will give you some kind of privilege, you build it, operate it for a while, and then it should be returned to us, it should be returned to the Norwegian government. As a result, most of the power plants in Norway are now considered to be the property of the government, writing the first concession certificate in 1909, approving the law for the companies that want to build and operate a hydroelectric power plant, they must get a statement of the concession, like the concession certificates they gave in Iran , but the law was radical for that. At the time, the law really said that everything that is under the ground belongs to the entire Norwegian society. It is not like saying that everyone likes it. Well, farmers and landowners don't like it. They thought that the water that is on our land belongs to us, we own its energy, but this law prevents that. He took it and said that this is everyone's property, it is the government's property , then he created a concession system, now the government could rent it to someone with a concession certificate , and this became the basis of an important understanding in Norway, in the society, I said in the government, but concession certificates are also given in Iran . Ratings in Iran started that day , but I thought I'd look a little at some of the similarities and differences, the comparison is really limited and incomplete in terms of my knowledge and knowledge, but I think it's an important and informative comparison . What I understand is that Iran and Norway are both in a position where they have a possibility that they cannot use. It can be done, but we cannot do it. We do not have the money or the technology to build a hydroelectric power plant, for example. Foreign capital is necessary, both of them are trying to attract capital by granting concessions. In Norway, the British can do it, just like in Iran, the Germans can also do the concession of the same water power plant and logging, and finally, in both countries, this concession system was able to do that. Bring the capital to carry out part of this modernization project. In one place, it is much more successful, in another place, it is much, much less. What was the result of these two? The result was that in Iran, this system of giving concessions and this took away the independence of the government to a large extent, that is, the government took cash, lost control, gave a lot of power to some foreign companies in Norway, but except that now these industries are developed. The energy infrastructure was fixed, the public interest of the people was clear, especially in the contracts, the benefit that the region, the local people and the city that had the capital went to, and they had to take it, was very clear in the contract, Norway's natural resources became something for both economic growth and public interest. A region with a long-term view now, with an environmentally friendly view, to an extent that is really much more advanced than the standards of those days, the conditions of Iran and Norway, of course, were not the same, Iran was under very strong foreign political pressure, with little independence , on the other hand, Norway had practically no formal independence . It was Sweden, but it had a good degree of autonomy and it didn't have the external pressure that Iran had, but I still think that we have to look at the differences in the points they gave. The most interesting thing is that the Iranian government wants to give them cash and immediate money, a part of it right now, go abroad, sometimes they really give a royalty for this or an obligation to pay money in the future, and this, from the very beginning, obviously gives different results . If both models are well made and implemented, and this is the water industry, the oil industry, or the railway itself, it could finally be an achievement , but it can be built before we get there. This is what the two countries are looking for. Or being able to look for a little bit shows that a different little bit starts from that first. In exchange for these points, Norway would get that a power plant that can be built will supply electricity to the region, a foreign company that comes to work here will build houses in the region, and build a school for the people. Region 9 is not only for its own employees, but it intertwines its industrial growth with the short-term and long-term interests of that region or many concessions that were made at that time. Norwegians give these environmental considerations and sustainable development to foreign companies, and this is the first of the 20th century , or is it that if this profit is divided, it should be spent or invested in the same place, I am just saying a few clues that I have found, it is really a matter. which is good in my opinion , the right research method should be a comparative study of this franchise system at the beginning of the 20th century in Iran and Norway, because there is a significant difference in this . This is not a mistake, the society is more developed and more literate. In the story of Iran's oil, in the oil disputes, we said that Iran had a contract with Darcy for 16%, he had to take a share of the profit, then he was arguing that our profit is low, it should be increased, and at that time, a person in Iran He didn't know that he could go to Darcy's accounting books to find out whether they gave this 16% or not. They were all arguing about whether 16 should be 20 , but there was no one who could go and check what percentage they are really giving what they are giving. How are they calculating? I am not saying this to say, for example, "Wow, the Qajars are so reckless, and so-and-so is cheating. I don't have such a story at all. I want to have a correct understanding of how much the society knew and how much it could have produced and developed." The situation is not only that of the Qajar era, I said that at the end of the Pahlavi era , during the revolution, half of Iran is still illiterate, the society is not well informed about the world of that day. to increase and know more and better means knowing more does not make us happy, but not knowing can definitely stop our happiness, we have no doubt about this, so we looked at the scorecards in two different ways and got two different answers in Iran, there was little economic and political independence, less social discontents also came behind it, none of this worked for Iran in Norway, but the strengthening of political and economic independence became the basis for the complete independence of the country at the beginning of the 20th century, and I say that it went in a completely different direction . Japan also has natural resources, it wants to make up for its backwardness in development a little earlier in these periods, Japan does not have the technology and money , and Japan, like Iran and unlike Norway, is under pressure and threats from outside, including some of the same countries that have technology and a The difference is that Japan is going this way very quickly. In Japan , development is carried out with a very large and large role of the government, reforms of the Meiji period , and of course the participation of the private sector with tax money, foreign loans, and government investment . I think it is interesting to look at the story of Japan alongside these. Now, let's go back and stick to the same story of Norway. Norway has this history since the first decades of the 20th century. When we are getting close to discovering oil in Norway, what is the state of oil in the world? Where is the oil coming from? Most of the oil is coming from the Middle East, from Saudi Arabia, Iran, and Iraq, and of course now the United States, the Soviet Union, Venezuela, and Mexico, and these are also in the next ranks, but the idea is that most of the oil is underground in the Middle East. At one time, it was thought that Latin America might have it. It was no longer focused on the Middle East, the largest consumer is the United States, followed by Western Europe , which needs a lot of energy for its growing economy after the war, then Japan and the Soviet Union, and now other growing and large economies in the world, there is a big jump in the economy and industry. It happens with oil energy. Before, it made a leap with coal energy. With the expansion of the railway, it did something to be able to carry heavy things to far places. Now with oil, the efficiency was much higher, because it was from a smaller volume, it took a lot of energy. Think about it. You can go from Tehran to Isfahan with a tank of gasoline If you wanted to get that energy from coal, how much coal would you have to take with you, how much more pollution was it, how much more harmful it was, the oil was much denser, much cleaner and with much higher productivity , it made the industrial leap possible, it was a very important resource, but the seven companies of the seven oil sisters Most of the market was in their hands, from production to distribution, and oil was cheap and abundant, and the conditions between the two wars, which were now very stable, during the explosive growth after the war, were more or less good, and all the major consumers were satisfied, but you During the middle decades of the 20th century, the market had become a little uncertain. The oil nationalization movement had started in Iran under the leadership of Mossadegh in 1953. The nationalization of Iranian oil was a threat to the western oil consuming countries . Control may be lost with a relatively cheap intervention and gathering it in the short term means re -guaranteeing their access to oil . It is unstable because it was not limited to that. It was 1953 and 1956. Gamal Abdul Nasser nationalized the Suez Canal. Again, this was the route of European oil . Arab nationalism fell and its voice was raised there too. It was possible that two guides would turn to the Soviet Union, and those cheap, stable and trouble-free sources of oil are facing new risks in the 1950s and 1930s . 60 In Europe, there will be a surprising discovery. In Holland, at the end of the 50s, a gas field is found on land in the Groningen field , and when you see it, it's amazing how big the field is, how much gas is there on land, but it's also near the North Sea, that's why some people think that you can see it. It was here, maybe it is in the North Sea, and it sharpened the tentacles of these countries around the North Sea. It was not something that they had not thought about before . And this is very unlikely in these coastal waters of ours, which in the geological scale of the recent waterlogging, oil and gas will be found under it, it is better not to graze ourselves, but this Groningen, which was found, the tentacles became sharper, the tentacles became sharp again , and the companies that are involved in the exploration and They were doing drilling and so on. Their business was found here, including an American company, Phillips, which had been working in Oklahoma for many years. We told you in Channel Bay, Oklahoma. He became very happy and then became very poor. This Phillips company had also worked there, then he came to see what Europe could do, including in the North Sea, this Groningen field. There was a place where it was said that there is no news and this is going and continuing geological studies. That company also came here to see where he can get a drilling license. He went to Holland, Holland, which is Shell and Exxon, and Germany is another one, and he went to Britain. There is, and Denmark also reached earlier and got an exclusive privilege. This is reaching Norway, Norway, which now has a very large beach on the North Sea, so Norway, which is now a country that we said has become industrialized, has democracy, corruption is very low, the quality of governance is good according to the indicators of that time. Agreed, at least now he wants to go see what he can do with this new phenomenon. Phillips came first and told him that you should give us some money for an exploration permit. Let's go and explore. Norway, with the previous experience he had with the hydroelectric industry, said no, we cannot accept such a thing. Now that time is new. It is not known at all where the Norwegian water is The maritime border of Norway and Denmark and this is all a story. The border of the North Sea has not been agreed upon and should be divided, but this made them say that we should move to divide faster. An agreement was reached in such a way that the division was very good for Norway . For example, Denmark was not very interesting. It is an interesting negotiation between the countries around the sea. We don't have anything to do with the basis of dividing it in the middle, but finally, Norway got a very large share of the North Sea, either by luck or with a big help from Great Britain. And how did they agree on these negotiations, and this is an interesting story. I had heard something that yes, in the negotiations between Norway and Denmark, the Danish foreign minister was very drunk, and when they were drawing where the border should be, the blue border was shaking. The oil fields that fell on the soil of Norway and in the waters of Norway is a fake story, but it is a funny story, but in short, they agreed here when they still do not know exactly what the consequences will be. Later, both Denmark and England saw that if they had stretched a few kilometers on the other side of the border, it would have made a lot of difference to them because it was a big field. It was found near the same border in the waters of Norway. The bottom line is that Norway's share of the resources of this sea has really increased. With this long coast , now its relationship with America is also good. We are also in a period when America is a very dominant power in Europe and Western Europe . To be able to work and look for oil in Norwegian waters in the North Sea of Norway again means that it will reach the same place as it was half a century ago with the development of the hydroelectric industry. Norwegian companies should bring this money from Norway, in this case, it is not known whether oil will be found in it or not, if it is found, when it will be found, where it will be, how much it will be, and whether it will be brought in . It is very uncertain. There is also a period of crisis in many European countries. You can't buy a car in Norway at all, it's forbidden because it takes out currency, the currency is so low, the government can't let currency go out like that , so Norwegian companies are not very willing to invest in this business, but they want a huge investment to see where the oil is, and it's right here. The difference between different countries becomes clear. If you want to see the difference, you don't really need to go far. Norway and Denmark are very similar in many ways , but the way to go is very different. Denmark, which once ruled Norway, now It is starting its oil story at the same time as Norway, with some differences , first of all, the hope of finding oil in Danish waters is much higher than in Norway today . More important than that, but the way Denmark deals with this newly found resource in Norway, which was the tradition of concessions and concessions, saying that everything under the background belongs to everyone, in fact, it is controlled by the government , and the government does not want to control it . Move forward very cautiously and step by step and create a large state-owned company as soon as possible to control these new resources and their development in Denmark . Its control in Denmark, where the liberal tradition was stronger, the development of the oil industry was mostly with the private sector, and of course, a small one was state-owned in Norway, and this difference was very big from the beginning . In the use of resources, Norway also used oil money, for example, to strengthen and expand its social security system , Denmark used it to achieve economic growth with it and to make itself independent in terms of energy faster, which by the way helped it later, easier and faster than others. Denmark's switch to renewable energy was faster than the rest In Norway, it was slower and its effect was revealed later, but of course it was much bigger. The same comparison can be made between Norway and England. England also developed its oil with private companies and remained private, and this is a continuous debate that is still going on, especially Now let's move forward to find out what Norway did with its oil money , what Denmark did, and what England did. This debate is even more interesting, especially between Norway and England. The main difference is, but we said that it came from experience, from the Norwegians' previous experience to get here, that we not only own these We want it , it means that it belongs to everyone, it is not going to be privatized, the government should own it, and it should maintain its control to a large extent. Make a law, make a concession law that companies can search for oil in a specified place for a limited time, i.e. block-by-block in the sea. Saying that these blocks belong to this company for a certain period of time, you can and should go and search during this period. If the period is over and you didn't work, or you worked and didn't find anything, you should give it back to the government of half of the North Sea. That's how they divide it between different Norwegian companies. Come on, give these companies some points so that they have the motivation to work here, for example, they don't go to Britain to work here, another good luck that Norway brought was that during that period when it gave these companies a lot of points, they didn't find many of them. Many of the sources that were later found there were not found at that time, when they found that the laws had changed and Norway had taken the upper hand in contracts. Another thing that is interesting to me here is the very conservative attitude of the Norwegian government. I said that they brought all the companies. Being here was a foreigner, the Norwegian government did not let the Norwegians express themselves when foreign companies paid more attention, the presence of Norwegian companies in the shipbuilding business, being in the metal industry, having a little connection with the outside world, they saw that foreign companies were all asking about Norwegian oil, and they wanted to express themselves in the game. But the Norwegian government said no, if they invest, spend money, and nothing will be found, our small and vulnerable economy will be hit hard by this leakage of capital, we don't want Norwegian companies to play the game . Christmas oil was found, yes, it was really the best Christmas present in their history that year, the Norwegians got it, probably they had been searching for a long time, they had not found anything , they were careless, they wanted to leave, the Norwegian government also said that if you leave, go, you have to pay for the damage, this is the last block and in the last efforts In the last days of Christmas Eve of 1969 , the Ekofisk field was found and the legend of Norway's oil began, and the history and story of Norway changed. 60 meters below the sea level. For now, facilities are being installed and pipes are being laid up to 3000 meters below the sea level. It is not much, but for that time, the drilling was dramatic. When it was found, the news came to the Norwegians. Now, they are happy to hear the news, but it is not known. What is the news? It is clear that yes there is oil and there is a lot of it. It will take a long time to understand that this field that has been found is huge. There is also a lot of oil here and in the North Sea as a whole. It seems that there is a lot of oil. Then the attention of oil companies will increase to Norway. Now everyone wants to say. Norway , then the government has come and revised its contracts with these companies in terms of taxes and royalties, and it wants oil income to stop falling out of its hands. It is the same story that was a problem for Iran half a century ago, they wanted to increase their final share, but they did not. Having capital, not having technology, in the first field that Norway found, it was 50-50, now its share is from royalties and taxes , which gradually came to 20-80 in the following decades, in a path full of negotiations, challenges and threats of companies. You cannot extract because we are going out Because of the advanced industry in Norway and because of this, there are new laws and new taxes that add that oil companies have to pay an additional tax and in short raise it like this. These are details now, but if we look at the whole, Norway made an interesting deal with This story is about the ten principles of writing the ten commandments , how do we want to manage our oil, which is the same as what I am saying. Its basis is that it belongs to all the people, which means that it should benefit everyone. Then, in the traditional Norwegian way, we should create a large oil company, then an institution. Let's create a monitoring system and let these two organizations be different, not one organization. This is happening in the first years, from when oil was discovered until the exploitation of the first well in the early 70's. 50% of it belongs to this company, foreign companies should also work with them, the profit should be shared, the exploitation should be done with cooperation, this gave this company strength, and technology started to develop this company so that it can work more and better. After that , it was separate. They did the commercial work. One group and another company did the supervisory work. Separating these two supervisory and commercial functions is something that not all countries do. The more important thing that should be done is that the oil industry should have been established For Norway, there is an industry that can bring oil, especially the first Ekofisk field that was found, it was far from the coast as far as you could be in Norway and away from the coast, and there was also oil whose market was Europe and England, but now Take it 300 km, bring it to Norway and process it here, then it was difficult to sell it to Europe. From a technical point of view, you couldn't do it. This meant that for Statoil , it had to set up an oil industry so that it could check this work on its own, see how it can do it, and what it should do . Statoil became a company that can do the technical work of development and operation, not just the owner of the field, then help the Norwegian companies to grow, so that little by little they can also work . Americans from Texas, Texan culture, speaking in Norway with the union and the labor union, and let them work, it was a challenging story, the story of how many accidents happened, how many people died, small accidents, big accidents, how many people died, standards should be stricter, this is still a path that has And it continues since then, and it continues. They say that one day we want to build an industry where mistakes can be made, there is room for mistakes, not an industry where when an accident happens, we want to say it was the fault, this was the mistake, something must be done. Let's try to reduce the mistakes, in fact, but also reduce the effect of the mistake. There is a place for mistakes , but this is with the help of many centuries of technical experience in the shipbuilding and maritime industry and decades of experience in capital management and foreign companies in the Norwegian water industry. The offshore oil industry developed, the submarine industry became very advanced in the world, and later, from 6-7 years ago, Statoil became one of the largest oil and later energy companies in the world under the new name Equinor . I think the story of the Norwegian oil industry itself We have already seen that Norway was not a poor country before the discovery of oil, it had established institutions, it had established political and economic traditions, all of which helped Norway to follow a low-risk and low-damage path since the discovery of oil . These five decades after the discovery of its oil are full of mistakes when we get into the details and full of learning and correcting the path for us, but there are still many questions left . to fix this industry in a different way We understood this , but we still don't understand what Norway did with its oil money. This is a question that we can start talking about now, because we have always heard Norway as an example of a small number of countries whose oil did not make their economy sick . Norway saw how oil weakens democracies and gave way to dictatorship and did something to not only avoid its harm but also to use this huge wealth in such a way that its method would become a lesson and many other countries would learn to speak out from the system. Get inspired and learn from Norway . Norway has become an exception among oil countries with a very transparent corruption system, very little democracy with high equality , which really has nothing in common with other oil countries like Iran, Venezuela, Russia, Saudi Arabia, etc. What did Norway do? How did he manage his oil? See it in a later video

Norway is one of those countries whose story is interesting to us. It is an oil country that is doing well. Norway is now a rich country in terms of many quality of life and quality of governance standards, and these are exemplary. Indeed, many countries in the world are curious about it. Since it is an oil country, we are also curious. More than that, a country that is a neighbor of Russia in Scandinavia and is a founding and effective member of NATO, the Secretary General of NATO, the former Prime Minister of Norway, is a relatively young country that is 100 years old and has almost become independent. It was 100 years ago in Sweden, 400 years ago it was in Denmark, and now the country has been independent for more than a century. It is not without problems, no country is without problems, Norway has many problems in many places and many of its systems, but many things like its social security system, such as its comprehensive insurance , or the readiness of its economy and its institutions for the coming decades, are truly regrettable, not only for distant countries , but even for its neighboring countries . It is close to it geographically and close to it in the graphs. If we look at the table of many indicators, Norway is at the top, and this shows that the country is being run well. This is another sign that the country is probably being run well. When it is high for a long time, why is it being run well? how are you Well, because they have oil, they have oil, sir, Norway has a lot of oil and gas, the population is also small, you know that this prosperity and prosperity is not such an art at all, it does not need a special art, everyone likes to do this, everyone knows how to do this, it is not money, money OK, everyone can, especially oil money, oil oil, a lot of people, and a small population. In this video, we want to see how true this statement is, in fact, we want to see how false this statement is. It won&#39;t last even a minute longer, and then we want to see the rest of it, so if This is not what is the story? Now, talking like that is fine for the barbecue and when peeling oranges and for example in the cafe and so on. We want to talk a little more precisely. We spent a little time and researched. I think it is worth spending this one hour on one of the most important topics that Our contemporary history is also relevant. Let&#39;s be a little more informed. I think maybe then we can better understand something like these charts, why is this chart that shows how much oil per person each Iranian or Norwegian or Venezuelan has in these countries. They have gas , and then this graph that shows the GDP per person of each of these countries, Venezuela , Iran, and Norway, how much is the difference per population . I said, so what&#39;s the story? The story is that Norway managed its oil, the simple answer is that Norway knew what to do, others didn&#39;t, for example, but why did Norway know? What did he know at all? How did he know? How did he learn what he didn&#39;t know? If he knew, why did he go down a path for 20 years that led to inflation and the bursting of the housing market, and then he went down another path , where the questions become more interesting and the answers require a little more work, a little curiosity and a little time and research and better questions and questions We did a little bit of research like this. I myself lived in Norway for a few years. I have some experiences. I heard and read and saw some things . Of course, in this research I realized that many of the things I read, heard and saw were incomplete and many were simply wrong. People, the things I had heard are the same. People sit down and talk the same way in these conversations and chats. Some really crazy things. I also heard from people who I thought were not crazy people, but now I understand that the words were not accurate. The story of Norway. We want to say , for example, in the last 100 years or 150 years, not the way we usually read in history books that there was this king and he fought and so and so happened, and we did not go to Norway with a question, what did Norway do that made oil so good for it? And for the answer, we want to go see that How is Norway and when did it become oil? And what was before it? And then, when he became an oilman, what did he do that was different from the rest of the world? Oil was found in Norway in the 1960s. The end of the 1960s will be 1969. The end of the 40s is 60 or 70 years later than Iran and Norway. Before oil was found, there were no poor people and there was no news of this wealth and prosperity , but they were not poor either in the development path. Let&#39;s look at the same GDP per capita graph for the 19th century. We can see that in 1870, Norway is at the level of countries like Finland, Italy, and Spain, and it is lower than the leading economies , but it is far better than somewhere like Portugal, than Eastern Europe, better than Mexico, Latin America, and Asian countries. And this is better, it is not the premier league of the world&#39;s economy , but it is wrong to think that it was poor, while in the second half of the 19th century it was industrializing and falling on the path of development. How is the second half of the 19th century much better than the first half ? If we want to tell the story of any country, we have to look at its geography. If we don&#39;t know a few basic questions about its geography, we ca n&#39;t answer the rest of our words about that country. It&#39;s very possible that geography is a very boring subject for me. Now it has become an interesting subject for me, it has become an interesting subject. Let&#39;s see the geography of Norway. Norway is a relatively long country with a long coastline and wide mountains. Its area is not small, but only a small part of this land is habitable. Maybe that is why its geography is so small, its climate is like this. It&#39;s hard to see, for example, Norway next to Japan, they are a bit similar in shape and size, and they are both mountainous, but if you put the two countries together, you have more than 20 Japanese people for every Norwegian, which means that the population is spread out a little in this big land. In general , agriculture can be done on less than 3% of the land, that is, if you look at Armenia, the area of arable land is the size of Norway, Armenia, which is 12 times smaller than Norway, can fit 12 times as much as Armenia in Norway , but their agricultural land is equal to each other, and its land is scattered and small. That is, it is not a suitable country for agriculture, so what did they do all these centuries when there was not much else to do except agriculture. This geography, which makes agriculture so difficult, also gives Norway opportunities, like what? Like if you look at it, it was practically impossible to go from eastern Norway to western Norway or from northern Norway to southern Norway on the same west bank for centuries , with these high rocky mountains and these deep fjords, and this was really geographical determinism, which prevented development from many points of view. It would have been difficult to connect these at all. Even today, Norway is not considered an advanced country with a wide network, even compared to its Scandinavian neighbors Sweden and Denmark, so how are these cities and habitats connected? Or the city or not, how are these dozens and these connected to each other? To be connected with what? From the water route, with so many fjords or fjords, Norway has a very, very long coastline. Look at Norway next to Britain. Norway is not an island that is surrounded by water, but how many times do you think the coastline of Norway is the coastline of Britain? Five times because of all these indentations and these fjords that come to the middle of the land, what does this mean? It means that it is true that Norway is a mountainous country like Iran and Afghanistan, its people lived separately from each other until before the railway came , it was very difficult to carry a heavy load from one place to another place, but in Norway everything was at the edge of the water. Or it was the mouth of a river that flowed into a fjord that was somehow connected to each other, so transportation was possible, that is, it was possible to go from one place to another in this fjord, and it became practical. The improvement of this geography created a need, and in response to that need, Norwegian society became one of the leaders in the shipbuilding and seafaring industry from ancient times to today . Being masters of building ships with which they can go on long journeys in the middle centuries, a few centuries before Christopher Columbus and others reached America, the Vikings went to Newfoundland to reach the territory of the New World , or from this side of the Russian side of the Volga. We told the story of the Hansa League in the Middle Ages in the North Sea in the Baltic with cities in England, Germany, the Baltic, and Russia today, and this all shows that it is good on the ship and in the sea . Being ahead in the age of discovery, whenever we read the story of explorers, we come across Norwegian names, people who either pioneered the way themselves, were pioneers , such as Nansen, Amunsen, Norway had many of these people , or people who built ships . Bekhare comes to the Norwegian shipbuilders or even when he was in Antarctica when he was in Antarctica , when he was tired and exhausted after a few weeks of wandering in the mountains of Antarctica, he went to a place on the island of South Georgia because he knew that there were a group of Norwegians who What does it mean that they are hunting whales here and there ? That is, the Norwegians have had a good shipbuilding and seafaring industry for centuries before Norway existed, so much so that Norwegian ships used to go to faraway waters and work there. In Norway itself, there were these rivers and fjords, and the ships used to go and come in these and this. It helped them to export their timber from other European countries, even countries with more forests than Norway , Sweden, Russia , but the Norwegians, because their sea transportation network was established, that means they could get access by boat, they could take the trees deep into the forest. They should carry a lot of nets , put them in the same river for export, let them go down to the fjord, their exports were very high compared to their share of European forests in the 19th century. We want to see what Norway was like when it got oil. This is the century that Norway is becoming industrialized. Again, its geography helps it. Norway is full of rivers and mountains. When the water comes down from the mountains, it means Norway&#39;s energy has free access to all energy sources. That&#39;s the energy that they didn&#39;t know then, we appreciate it more now because it&#39;s renewable energy, clean energy, so to speak, all these waterfalls, all the water that comes from a height means energy, that means electricity, these trees that are cut down in the river, they come down there, there&#39;s a sawmill down there that uses its energy. It was taking from the same river, that is, that river was doing two big things for them for free, both transportation and supplying energy to the sawmill, and thus Norway&#39;s timber exports were very high. It was becoming industrialized from the end of the 19th century . I say that they could build a lot of factories in many cities of Norway, there are factories by the river and then houses for the workers, and then the place grew and grew. Cheap energy helped industries like aluminum and these to grow . There are many forests in Norway, for example papermaking and now manufacturing. Wood and timber, as we said, of course, most of the people are still not in industry, most of the people are still in agriculture and fishing, but now with this cold and hard weather, there was no special agriculture, but it was the same, and then cod and herring fishing are the main exports. There was fish and marine services and navigation, but let&#39;s not forget that they are not poor, in terms of per capita wealth, we said here, it is by no means one of the poor countries in Europe, Norway is even rising, but life is hard, life is really hard . Canada goes to America, rural, generally scattered, decentralized population , hard to reach The roads are very poor and this continues until the beginning of the 20th century. It is still not a poor country. Three decades or four decades in the 20th century before the Second World War started, Norway&#39;s situation is this in terms of GDP per capita. Before the war, it was one of the Why is it the highest in Europe ? For the same reasons as I said in the first decades of the 20th century, hydropower plants, rivers that create energy, damming and development of the hydropower industry, this is what happened in the first half of the 20th century, they built hydropower plants in such a way that since 1950, more than 95% of the total electricity consumed in Norway It is supplied from hydroelectric power plants , of course , the hydroelectric industry still exists and is being built, and it is gradually increasing its production . Electricity is the new energy. Everything that was done before is now going to be done with electricity, including the most important one in energy industries such as aluminum, energy industries such as aluminum , which have been relying on hydroelectricity since that time until now . What is the result? The result is that Norway is one of the biggest producers of aluminum in the whole of Europe from that time until now . Except for this, of course, now they are spending on research and development and some industries that they thought could be future industries are working on nuclear energy, telecommunications, communications. and the defense and military industries, and these were the things that they thought the future had, the way they worked, look again, this is not something that a poor, backward country wants to do . He was poor until oil came , which is clearly a wrong statement, not true, society, but how was his condition? Now, by society, I mean, what kind of people are people? Being a people who were literate to a good extent, especially now the Lutheran Church also played a big role in this expansion of public education and making the society literate very soon, very many of them were literate . In Norway, there is almost no illiteracy anymore, there is a big difference between 50% and 100%. This is just 1979, 1957. Before the revolution , before the discovery of oil, the state of literacy in Norwegian society was good. The society was literate to a great extent. It is constitutional , it is a government that still exists, its system is its government system, in fact , since before the discovery of oil, before the Norwegian governments became rich, they also have welfare policies . This is not the case, both Norway had extensive welfare policies before oil, and other Scandinavian countries that do not have oil have this. It is a model of the welfare state implemented by the Nordic countries, which is really not similar to it in the whole human experience, or very, very little. It is a system and an institution. Even if it is traditional, he was able to come to the aid of those who need help the most, to those who bring bad luck in life, and help them in this way, so that it is so widespread, something that cannot be done without the government, and they were able to do this with this model. Their welfare governments should do it now, in different ways, this is one of their values since then, before the talk of oil in the middle of the 20th century, there should be less inequality, it is one of the things that Norway is pursuing, of course, it was already like Sweden and this was not even there, for example, not having too much distance between people at all. Norway does not have a very big and strong aristocracy, like other European countries , or even Sweden, which is like that, is similar to Sweden and Norway in many ways , but this is a difference. In Sweden, there was little difference between the people, but in Norway it was very little, and the economy was in many places. We call it a cooperative, like a factory whose workers own shares, an economic model . A farm where all the farmers who work the same way own it, common ownership and a kind of democratic administration and make decisions together and share the profit and loss together, and small units of sparsely populated villages with very little capital, for example, the shipping industry was collected in the hands of a few people From the beginning, it had a cooperative nature, and later , other industries were established in Norway based on these cooperatives, from agriculture to animal husbandry to marine insurance to fisheries to financial institutions . I had read it scattered and it stuck to me , I mean, I didn&#39;t understand this point because this is a special kind of business, a kind of business that requires people to have high trust in each other, and of course, the result is good and successful. The point is that people&#39;s trust in each other increases and it becomes interesting when we understand that trust is one of the most important values of Norwegian society, they are aware that they have to keep it high and it is one of the components that we see has been important and they are proud of it even today . They take care of it and are sensitive to its decrease, such as equality , the welfare system , such as social democracy, such as nature-loving, such as cooperation , such as the things we talked about once before in another video in building a new Norwegian culture , of course, the Protestant ethic, which he also mentioned before. We talked, it was a strong foundation in shaping the culture of the society, and it helped them again. This does not mean that this society does not have anything negative, it means that because of this history and this geography, which has threats and opportunities There have been negative things and there have been positive things. How was he able to write the story of his own progress and find his own way through trial and error? World War II, as we know, Norway was occupied, that is, Nazi Germany came and took Norway, war and destruction, and these things after the war as well. It was one of the countries that went into reconstruction with the help of the US in the Marshall Plan, including strengthening the system of the welfare state and social democracy , which had a dominant political culture since the beginning of the 20th century . Oil is being found. I had heard the story of oil in Norway before , but since the discovery of oil, I did n&#39;t know its previous history, so I didn&#39;t really understand what happened when the Norwegians found oil. Not going? Why not go the way of England? Because the only way to go was not what to do now , but the only way was not that and I couldn&#39;t find a good answer for it because I didn&#39;t know what the Norwegian society had experienced before oil, and when it came to the story of oil, based on that What experiences did this model have? Let&#39;s go back to the industrialization of Norway, how did it become industrialized? With the hydropower industry with power plants and dam construction and so on , how do you start building dams and power plants and so on? It is something that needs capital, which Norway did not have , and technology, which was not in Norway, what to do? It was a problem that had to be solved. Norway was involved with this problem for half a century. It was investigating solutions and trying and making mistakes. And this experience in working with foreign companies in working in an industry where you have the resources but the capital and technology for its development. Did n&#39;t you have a model for managing the new Norwegian industry or the Norwegian oil industry ? A very important example was this scoring system, giving points like the points that we say during the Qajar era, they gave tobacco points, such points mean that when they were working in the water industry, they used a scoring system , which later when they started oil first with The same model of moving forward What was this system based on? Sir, these resources that are natural are here in Norway, they all belong to all the people, they belong to the government , which represents the people and should be developed in such a way that the benefits for the people are maximized . I say that the government of Norway and the government of Iran, for example, are similar to each other, they are both constitutional kingdoms , but the mistakes are practically limited to the same paper in Norway, both in practice and in the eyes of these resources . It should be exploited and used for the benefit of everyone. Don&#39;t look at oil like this everywhere. If we look at what England did with American oil, what did Denmark do with oil ? He looked, there is another thing here that is interesting to me, I think it is related, I didn&#39;t read this somewhere, it occurred to me that if there is something in common, I understand that there is something that we are many, many people who are very different from each other. We all own it, we don&#39;t agree on anything , but this belongs to us, we have to do something to ensure that the interests of our pair are guaranteed. When we say that oil, water, or natural resources belong to everyone, there is a similar thought behind it so that the society can To deal with such a thought, to understand it and implement the necessary equipment, one must really have an understanding of this. We can see the history of this understanding in the work they did centuries ago , for example, see how ship building was done in Norway. They wanted to build a very big ship. It was a difficult job, we are talking about big companies and they are not in the business, a lot of work has to be done, how do you build this? We say that they are building a partnership, not a private joint-stock company, a kind of cooperative, for example, in many places in Norway, every city, every place, every village works together to build this ship or to build these ships . One meaning is that it will benefit all of them, the work orientation that works in shipbuilding, the suppliers who each have a piece of work, they have a piece of equipment, they build, they are all partners, the old ones , or let&#39;s say the Hansa League, whose story we told at once. In the middle centuries, from the time of Genghis Khan, we said that they were working together in partnership with different cities in countries that are not now one, including a city in the west of Norway. They were cooperating with others to define common interests . Creating a co-op together, working together, this is working with others for common interests, which is not easy for everyone, it takes practice, we already know this, the tradition is not strong in our society, so the skills of working together in our temperaments, there is not much room for their cultivation. It was found that there was no priority for them, because we really didn&#39;t need everyone to do their own work, and as a result, even now in the 20th century, we see that we are not good at many of these skills. Defining a common goal is a bit difficult for us to compromise, and it is difficult for us to accept at all. That we are different from each other and this is completely ok, this is not very comfortable for us, it is not very comfortable for us, many times and this unfortunately shows itself in many places . Naturally, it belongs to everyone, and when in the late 19th century and early 20th century, big foreign investors came to buy these waterfalls and build a hydroelectric power plant here, with the same common understanding, the Norwegians went to them, looked at them and said, this is common property, this belongs to everyone, we can&#39;t sell it , we can We will give you some kind of privilege, you build it, operate it for a while, and then it should be returned to us, it should be returned to the Norwegian government. As a result, most of the power plants in Norway are now considered to be the property of the government, writing the first concession certificate in 1909, approving the law for the companies that want to build and operate a hydroelectric power plant, they must get a statement of the concession, like the concession certificates they gave in Iran , but the law was radical for that. At the time, the law really said that everything that is under the ground belongs to the entire Norwegian society. It is not like saying that everyone likes it. Well, farmers and landowners don&#39;t like it. They thought that the water that is on our land belongs to us, we own its energy, but this law prevents that. He took it and said that this is everyone&#39;s property, it is the government&#39;s property , then he created a concession system, now the government could rent it to someone with a concession certificate , and this became the basis of an important understanding in Norway, in the society, I said in the government, but concession certificates are also given in Iran . Ratings in Iran started that day , but I thought I&#39;d look a little at some of the similarities and differences, the comparison is really limited and incomplete in terms of my knowledge and knowledge, but I think it&#39;s an important and informative comparison . What I understand is that Iran and Norway are both in a position where they have a possibility that they cannot use. It can be done, but we cannot do it. We do not have the money or the technology to build a hydroelectric power plant, for example. Foreign capital is necessary, both of them are trying to attract capital by granting concessions. In Norway, the British can do it, just like in Iran, the Germans can also do the concession of the same water power plant and logging, and finally, in both countries, this concession system was able to do that. Bring the capital to carry out part of this modernization project. In one place, it is much more successful, in another place, it is much, much less. What was the result of these two? The result was that in Iran, this system of giving concessions and this took away the independence of the government to a large extent, that is, the government took cash, lost control, gave a lot of power to some foreign companies in Norway, but except that now these industries are developed. The energy infrastructure was fixed, the public interest of the people was clear, especially in the contracts, the benefit that the region, the local people and the city that had the capital went to, and they had to take it, was very clear in the contract, Norway&#39;s natural resources became something for both economic growth and public interest. A region with a long-term view now, with an environmentally friendly view, to an extent that is really much more advanced than the standards of those days, the conditions of Iran and Norway, of course, were not the same, Iran was under very strong foreign political pressure, with little independence , on the other hand, Norway had practically no formal independence . It was Sweden, but it had a good degree of autonomy and it didn&#39;t have the external pressure that Iran had, but I still think that we have to look at the differences in the points they gave. The most interesting thing is that the Iranian government wants to give them cash and immediate money, a part of it right now, go abroad, sometimes they really give a royalty for this or an obligation to pay money in the future, and this, from the very beginning, obviously gives different results . If both models are well made and implemented, and this is the water industry, the oil industry, or the railway itself, it could finally be an achievement , but it can be built before we get there. This is what the two countries are looking for. Or being able to look for a little bit shows that a different little bit starts from that first. In exchange for these points, Norway would get that a power plant that can be built will supply electricity to the region, a foreign company that comes to work here will build houses in the region, and build a school for the people. Region 9 is not only for its own employees, but it intertwines its industrial growth with the short-term and long-term interests of that region or many concessions that were made at that time. Norwegians give these environmental considerations and sustainable development to foreign companies, and this is the first of the 20th century , or is it that if this profit is divided, it should be spent or invested in the same place, I am just saying a few clues that I have found, it is really a matter. which is good in my opinion , the right research method should be a comparative study of this franchise system at the beginning of the 20th century in Iran and Norway, because there is a significant difference in this . This is not a mistake, the society is more developed and more literate. In the story of Iran&#39;s oil, in the oil disputes, we said that Iran had a contract with Darcy for 16%, he had to take a share of the profit, then he was arguing that our profit is low, it should be increased, and at that time, a person in Iran He didn&#39;t know that he could go to Darcy&#39;s accounting books to find out whether they gave this 16% or not. They were all arguing about whether 16 should be 20 , but there was no one who could go and check what percentage they are really giving what they are giving. How are they calculating? I am not saying this to say, for example, &quot;Wow, the Qajars are so reckless, and so-and-so is cheating. I don&#39;t have such a story at all. I want to have a correct understanding of how much the society knew and how much it could have produced and developed.&quot; The situation is not only that of the Qajar era, I said that at the end of the Pahlavi era , during the revolution, half of Iran is still illiterate, the society is not well informed about the world of that day. to increase and know more and better means knowing more does not make us happy, but not knowing can definitely stop our happiness, we have no doubt about this, so we looked at the scorecards in two different ways and got two different answers in Iran, there was little economic and political independence, less social discontents also came behind it, none of this worked for Iran in Norway, but the strengthening of political and economic independence became the basis for the complete independence of the country at the beginning of the 20th century, and I say that it went in a completely different direction . Japan also has natural resources, it wants to make up for its backwardness in development a little earlier in these periods, Japan does not have the technology and money , and Japan, like Iran and unlike Norway, is under pressure and threats from outside, including some of the same countries that have technology and a The difference is that Japan is going this way very quickly. In Japan , development is carried out with a very large and large role of the government, reforms of the Meiji period , and of course the participation of the private sector with tax money, foreign loans, and government investment . I think it is interesting to look at the story of Japan alongside these. Now, let&#39;s go back and stick to the same story of Norway. Norway has this history since the first decades of the 20th century. When we are getting close to discovering oil in Norway, what is the state of oil in the world? Where is the oil coming from? Most of the oil is coming from the Middle East, from Saudi Arabia, Iran, and Iraq, and of course now the United States, the Soviet Union, Venezuela, and Mexico, and these are also in the next ranks, but the idea is that most of the oil is underground in the Middle East. At one time, it was thought that Latin America might have it. It was no longer focused on the Middle East, the largest consumer is the United States, followed by Western Europe , which needs a lot of energy for its growing economy after the war, then Japan and the Soviet Union, and now other growing and large economies in the world, there is a big jump in the economy and industry. It happens with oil energy. Before, it made a leap with coal energy. With the expansion of the railway, it did something to be able to carry heavy things to far places. Now with oil, the efficiency was much higher, because it was from a smaller volume, it took a lot of energy. Think about it. You can go from Tehran to Isfahan with a tank of gasoline If you wanted to get that energy from coal, how much coal would you have to take with you, how much more pollution was it, how much more harmful it was, the oil was much denser, much cleaner and with much higher productivity , it made the industrial leap possible, it was a very important resource, but the seven companies of the seven oil sisters Most of the market was in their hands, from production to distribution, and oil was cheap and abundant, and the conditions between the two wars, which were now very stable, during the explosive growth after the war, were more or less good, and all the major consumers were satisfied, but you During the middle decades of the 20th century, the market had become a little uncertain. The oil nationalization movement had started in Iran under the leadership of Mossadegh in 1953. The nationalization of Iranian oil was a threat to the western oil consuming countries . Control may be lost with a relatively cheap intervention and gathering it in the short term means re -guaranteeing their access to oil . It is unstable because it was not limited to that. It was 1953 and 1956. Gamal Abdul Nasser nationalized the Suez Canal. Again, this was the route of European oil . Arab nationalism fell and its voice was raised there too. It was possible that two guides would turn to the Soviet Union, and those cheap, stable and trouble-free sources of oil are facing new risks in the 1950s and 1930s . 60 In Europe, there will be a surprising discovery. In Holland, at the end of the 50s, a gas field is found on land in the Groningen field , and when you see it, it&#39;s amazing how big the field is, how much gas is there on land, but it&#39;s also near the North Sea, that&#39;s why some people think that you can see it. It was here, maybe it is in the North Sea, and it sharpened the tentacles of these countries around the North Sea. It was not something that they had not thought about before . And this is very unlikely in these coastal waters of ours, which in the geological scale of the recent waterlogging, oil and gas will be found under it, it is better not to graze ourselves, but this Groningen, which was found, the tentacles became sharper, the tentacles became sharp again , and the companies that are involved in the exploration and They were doing drilling and so on. Their business was found here, including an American company, Phillips, which had been working in Oklahoma for many years. We told you in Channel Bay, Oklahoma. He became very happy and then became very poor. This Phillips company had also worked there, then he came to see what Europe could do, including in the North Sea, this Groningen field. There was a place where it was said that there is no news and this is going and continuing geological studies. That company also came here to see where he can get a drilling license. He went to Holland, Holland, which is Shell and Exxon, and Germany is another one, and he went to Britain. There is, and Denmark also reached earlier and got an exclusive privilege. This is reaching Norway, Norway, which now has a very large beach on the North Sea, so Norway, which is now a country that we said has become industrialized, has democracy, corruption is very low, the quality of governance is good according to the indicators of that time. Agreed, at least now he wants to go see what he can do with this new phenomenon. Phillips came first and told him that you should give us some money for an exploration permit. Let&#39;s go and explore. Norway, with the previous experience he had with the hydroelectric industry, said no, we cannot accept such a thing. Now that time is new. It is not known at all where the Norwegian water is The maritime border of Norway and Denmark and this is all a story. The border of the North Sea has not been agreed upon and should be divided, but this made them say that we should move to divide faster. An agreement was reached in such a way that the division was very good for Norway . For example, Denmark was not very interesting. It is an interesting negotiation between the countries around the sea. We don&#39;t have anything to do with the basis of dividing it in the middle, but finally, Norway got a very large share of the North Sea, either by luck or with a big help from Great Britain. And how did they agree on these negotiations, and this is an interesting story. I had heard something that yes, in the negotiations between Norway and Denmark, the Danish foreign minister was very drunk, and when they were drawing where the border should be, the blue border was shaking. The oil fields that fell on the soil of Norway and in the waters of Norway is a fake story, but it is a funny story, but in short, they agreed here when they still do not know exactly what the consequences will be. Later, both Denmark and England saw that if they had stretched a few kilometers on the other side of the border, it would have made a lot of difference to them because it was a big field. It was found near the same border in the waters of Norway. The bottom line is that Norway&#39;s share of the resources of this sea has really increased. With this long coast , now its relationship with America is also good. We are also in a period when America is a very dominant power in Europe and Western Europe . To be able to work and look for oil in Norwegian waters in the North Sea of Norway again means that it will reach the same place as it was half a century ago with the development of the hydroelectric industry. Norwegian companies should bring this money from Norway, in this case, it is not known whether oil will be found in it or not, if it is found, when it will be found, where it will be, how much it will be, and whether it will be brought in . It is very uncertain. There is also a period of crisis in many European countries. You can&#39;t buy a car in Norway at all, it&#39;s forbidden because it takes out currency, the currency is so low, the government can&#39;t let currency go out like that , so Norwegian companies are not very willing to invest in this business, but they want a huge investment to see where the oil is, and it&#39;s right here. The difference between different countries becomes clear. If you want to see the difference, you don&#39;t really need to go far. Norway and Denmark are very similar in many ways , but the way to go is very different. Denmark, which once ruled Norway, now It is starting its oil story at the same time as Norway, with some differences , first of all, the hope of finding oil in Danish waters is much higher than in Norway today . More important than that, but the way Denmark deals with this newly found resource in Norway, which was the tradition of concessions and concessions, saying that everything under the background belongs to everyone, in fact, it is controlled by the government , and the government does not want to control it . Move forward very cautiously and step by step and create a large state-owned company as soon as possible to control these new resources and their development in Denmark . Its control in Denmark, where the liberal tradition was stronger, the development of the oil industry was mostly with the private sector, and of course, a small one was state-owned in Norway, and this difference was very big from the beginning . In the use of resources, Norway also used oil money, for example, to strengthen and expand its social security system , Denmark used it to achieve economic growth with it and to make itself independent in terms of energy faster, which by the way helped it later, easier and faster than others. Denmark&#39;s switch to renewable energy was faster than the rest In Norway, it was slower and its effect was revealed later, but of course it was much bigger. The same comparison can be made between Norway and England. England also developed its oil with private companies and remained private, and this is a continuous debate that is still going on, especially Now let&#39;s move forward to find out what Norway did with its oil money , what Denmark did, and what England did. This debate is even more interesting, especially between Norway and England. The main difference is, but we said that it came from experience, from the Norwegians&#39; previous experience to get here, that we not only own these We want it , it means that it belongs to everyone, it is not going to be privatized, the government should own it, and it should maintain its control to a large extent. Make a law, make a concession law that companies can search for oil in a specified place for a limited time, i.e. block-by-block in the sea. Saying that these blocks belong to this company for a certain period of time, you can and should go and search during this period. If the period is over and you didn&#39;t work, or you worked and didn&#39;t find anything, you should give it back to the government of half of the North Sea. That&#39;s how they divide it between different Norwegian companies. Come on, give these companies some points so that they have the motivation to work here, for example, they don&#39;t go to Britain to work here, another good luck that Norway brought was that during that period when it gave these companies a lot of points, they didn&#39;t find many of them. Many of the sources that were later found there were not found at that time, when they found that the laws had changed and Norway had taken the upper hand in contracts. Another thing that is interesting to me here is the very conservative attitude of the Norwegian government. I said that they brought all the companies. Being here was a foreigner, the Norwegian government did not let the Norwegians express themselves when foreign companies paid more attention, the presence of Norwegian companies in the shipbuilding business, being in the metal industry, having a little connection with the outside world, they saw that foreign companies were all asking about Norwegian oil, and they wanted to express themselves in the game. But the Norwegian government said no, if they invest, spend money, and nothing will be found, our small and vulnerable economy will be hit hard by this leakage of capital, we don&#39;t want Norwegian companies to play the game . Christmas oil was found, yes, it was really the best Christmas present in their history that year, the Norwegians got it, probably they had been searching for a long time, they had not found anything , they were careless, they wanted to leave, the Norwegian government also said that if you leave, go, you have to pay for the damage, this is the last block and in the last efforts In the last days of Christmas Eve of 1969 , the Ekofisk field was found and the legend of Norway&#39;s oil began, and the history and story of Norway changed. 60 meters below the sea level. For now, facilities are being installed and pipes are being laid up to 3000 meters below the sea level. It is not much, but for that time, the drilling was dramatic. When it was found, the news came to the Norwegians. Now, they are happy to hear the news, but it is not known. What is the news? It is clear that yes there is oil and there is a lot of it. It will take a long time to understand that this field that has been found is huge. There is also a lot of oil here and in the North Sea as a whole. It seems that there is a lot of oil. Then the attention of oil companies will increase to Norway. Now everyone wants to say. Norway , then the government has come and revised its contracts with these companies in terms of taxes and royalties, and it wants oil income to stop falling out of its hands. It is the same story that was a problem for Iran half a century ago, they wanted to increase their final share, but they did not. Having capital, not having technology, in the first field that Norway found, it was 50-50, now its share is from royalties and taxes , which gradually came to 20-80 in the following decades, in a path full of negotiations, challenges and threats of companies. You cannot extract because we are going out Because of the advanced industry in Norway and because of this, there are new laws and new taxes that add that oil companies have to pay an additional tax and in short raise it like this. These are details now, but if we look at the whole, Norway made an interesting deal with This story is about the ten principles of writing the ten commandments , how do we want to manage our oil, which is the same as what I am saying. Its basis is that it belongs to all the people, which means that it should benefit everyone. Then, in the traditional Norwegian way, we should create a large oil company, then an institution. Let&#39;s create a monitoring system and let these two organizations be different, not one organization. This is happening in the first years, from when oil was discovered until the exploitation of the first well in the early 70&#39;s. 50% of it belongs to this company, foreign companies should also work with them, the profit should be shared, the exploitation should be done with cooperation, this gave this company strength, and technology started to develop this company so that it can work more and better. After that , it was separate. They did the commercial work. One group and another company did the supervisory work. Separating these two supervisory and commercial functions is something that not all countries do. The more important thing that should be done is that the oil industry should have been established For Norway, there is an industry that can bring oil, especially the first Ekofisk field that was found, it was far from the coast as far as you could be in Norway and away from the coast, and there was also oil whose market was Europe and England, but now Take it 300 km, bring it to Norway and process it here, then it was difficult to sell it to Europe. From a technical point of view, you couldn&#39;t do it. This meant that for Statoil , it had to set up an oil industry so that it could check this work on its own, see how it can do it, and what it should do . Statoil became a company that can do the technical work of development and operation, not just the owner of the field, then help the Norwegian companies to grow, so that little by little they can also work . Americans from Texas, Texan culture, speaking in Norway with the union and the labor union, and let them work, it was a challenging story, the story of how many accidents happened, how many people died, small accidents, big accidents, how many people died, standards should be stricter, this is still a path that has And it continues since then, and it continues. They say that one day we want to build an industry where mistakes can be made, there is room for mistakes, not an industry where when an accident happens, we want to say it was the fault, this was the mistake, something must be done. Let&#39;s try to reduce the mistakes, in fact, but also reduce the effect of the mistake. There is a place for mistakes , but this is with the help of many centuries of technical experience in the shipbuilding and maritime industry and decades of experience in capital management and foreign companies in the Norwegian water industry. The offshore oil industry developed, the submarine industry became very advanced in the world, and later, from 6-7 years ago, Statoil became one of the largest oil and later energy companies in the world under the new name Equinor . I think the story of the Norwegian oil industry itself We have already seen that Norway was not a poor country before the discovery of oil, it had established institutions, it had established political and economic traditions, all of which helped Norway to follow a low-risk and low-damage path since the discovery of oil . These five decades after the discovery of its oil are full of mistakes when we get into the details and full of learning and correcting the path for us, but there are still many questions left . to fix this industry in a different way We understood this , but we still don&#39;t understand what Norway did with its oil money. This is a question that we can start talking about now, because we have always heard Norway as an example of a small number of countries whose oil did not make their economy sick . Norway saw how oil weakens democracies and gave way to dictatorship and did something to not only avoid its harm but also to use this huge wealth in such a way that its method would become a lesson and many other countries would learn to speak out from the system. Get inspired and learn from Norway . Norway has become an exception among oil countries with a very transparent corruption system, very little democracy with high equality , which really has nothing in common with other oil countries like Iran, Venezuela, Russia, Saudi Arabia, etc. What did Norway do? How did he manage his oil? See it in a later video

Transcript for:Exploring Norway's Oil Industry and Governance

Transcript for:
Exploring Norway's Oil Industry and Governance