Gas sales changeover completed

October 2, 2002, 11:45 CEST

The transition to company-based sales of Norwegian offshore gas, which has replaced coordinated contact negotiations, was completed with the start of the new gas year on 1 October.

Norway’s gas negotiating and gas supply (GFU/FU) committees ceased to exist in 2001. Each company with gas production is now marketing and administering its own deliveries.

The new model will sharpen competition in line with the European Union’s intentions, says Erik Kjos-Hanssen, vice president for gas supply and transport in Natural Gas.

This changeover opens new opportunities for Statoil. It can buy sales gas from other offshore players, for instance, or offer back-up services to sellers to secure their delivery commitments.

Statoil currently markets and sells both its own entitlement gas and the state’s directly-owned supplies. This corresponds to about 70 per cent of Norwegian production.

On the first day of the new gas year, the group sold 109 million cubic metres of gas.

Mr Kjos-Hanssen says that the new model means big changes for the producers. Statoil, for instance, used to supply daily information to buyers on behalf of all the sellers.

Twenty-two companies hold long-term gas purchase contracts with Statoil, and staff in Natural Gas have done a major job in restructuring all these deals.

A number of information meetings have also been held with these customers.

As a result of the change, buyers can now negotiate with and order gas from any gas owner they wish.

Opportunities for licensees to produce their share of a field’s reserves have been made more flexible, Mr Kjos-Hanssen reports.

Previously, each licensee had to lift its fixed share of the gas every day. It can now do this to a greater extent independently of its share.

However, accounts must be kept to ensure that each company ends up with an overall volume which corresponds to its rightful proportion.