State's Direct Financial Interest

State's Direct Financial Interest (SDFI) (Norwegian: Statens direkte økonomiske engasjement (SDØE)) is a portfolio of the Norwegian government's directly owned exploration and production licenses for petroleum and natural gas on the Norwegian continental shelf. The Norwegian government-owned company Petoro has managed the SDFI portfolio since 2001.

The Norwegian government claims ownership of all resources on and under the sea in the geographical area known as the Norwegian continental shelf. The Norwegian government awards production licences to cooperating companies to find and produce petroleum in specific areas.

The Norwegian government creates income from the petroleum sector through taxes and fees as well as itself being a participant in the industry. The Norwegian government initially participated in the industry through the creation and development of the state oil company Statoil. From 1973 to 1985 the government awarded Statoil 50% or more of Norway's petroleum development licenses. In the 1980s political discourse questioned this arrangement as Statoil's cash flow was becoming very large in relation to Norway's gross national product. The solution was splitting Statoil's ownership. SDFI was created on January 1, 1985, as a separate juridical entity managed by Statoil. Statoil's original ownership was divided in two, with approximately 20% retained by Statoil itself, and the rest given to SDFI.

When Statoil was partially privatised in 2001 this solution was no longer desirable and a new state-owned management company Petoro was created to manage SDFI. The Norwegian government also reduced the size of SDFI by 20%, with 15% of the portfolio going to Statoil and 5% to Norsk Hydro.

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