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Norwegian oil major Statoil ASA’s (STO - Free Report) share prices surprised with a respective 1.4% and 0.3% drop in the two trading sessions after it announced its intent to keep exploration spending for 2014 close to the 2013 record level. The company also intends to be more selective in choosing exploration targets to lessen risk and control spending.

Statoil’s focus will be directed toward areas where it has made recent discoveries. These include Norway, the Gulf of Mexico, Brazil, Canada, Angola and Tanzania.

State-controlled Statoil will also operate two wells off Angola next year, two off the Faroe Islands and one or two in the U.S. Gulf of Mexico, including drilling of six wells, off Tanzania.

One area of focus will be eastern Canada, where some major discoveries were made this year. Statoil is trying to engage appropriate rig capacity for further drilling into 2015.

The company’s spending on exploration is likely to touch $3.75 billion this year, a record amount for the firm. The amount also exceeds its target of $3.5 billion set early in the year. This amount will be spent by Statoil in 2014 on about 60 wells. The company is expected to drill fewer wells in 2014.

Per the company, around 25 of next year’s wells – 67% government owned and based in Stavanger – will be drilled off Norway. Statoil also plans to abandon certain areas like Mozambique, where wells have proven unsuccessful.

Statoil’s exploration boosted its resources by 1.5 billion barrels and around 900 million barrels so far in 2013. Per the company records, it has been one of the most successful offshore explorers in recent years in terms of conventional output.

Statoil carries a Zacks Rank #3 (Hold). Some better-ranked stocks in the same sector include SM Energy Company (SM - Free Report) , Western Gas Partners LP (WES - Free Report) and Abraxas Petroleum Corp. (AXAS - Free Report) . All these stocks hold a Zacks Rank #1 (Strong Buy).

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