Staged approach to gas in Norway

August 6, 2004, 16:00 CEST

An increase in domestic gas consumption is to be sought by the Norwegian government through a stage-by-stage development of the market.

This emerges from a White Paper on innovative efforts to support environment-friendly gas-fired power technologies and so forth, which was presented today, 6 August.

“Markets for natural gas in Norway are small and spread over a number of locations,” the policy document notes. “Delivering gas by ship will therefore often be the most appropriate solution.”

It also concludes that liquefied natural gas could be sold in Norway at prices which cover costs.

An infrastructure for such deliveries can be developed in line with sales growth, with gas pipelines becoming more relevant once the market has been established.

“This is completely in line with our view of the best way to develop a domestic gas market,” says Einar Stømsvåg, acting head of Statoil’s Manufacturing & Marketing business area.

“A step-by-step approach through small-scale solutions represents the right approach.

“The government’s attitude accords with our commercial concept for small-scale LNG developments based on shipment to customers by sea.

“We have been working on such solutions for a long time, but they are not fully matured yet in commercial terms.”

He emphasises that an important condition for developing a Norwegian gas market is that the instruments currently in place to support the creation of receiving terminals are retained.