Cove Point preparing for Snøhvit gas

October 6, 2006, 14:45 CEST

The expansion of the gas receiving terminal at Cove Point on the east coast of the United States is under way. Dominion is now making the final major preparations in order to receive gas from the Snøhvit field in the Barents Sea.

Rune Bjørnson (fourth from right), executive vice president for the Natural Gas (NG) business area in Statoil, was present on Thursday 5 October when the expansion work began at Cove Point in the state of Maryland.

“Statoil is making a focused commitment to be a long-term and reliable supplier of energy,” said Mr Bjørnson. “The agreement with energy company Dominion for the delivery of liquefied natural gas (LNG) from Snøhvit is an important part of the implementation of the group’s strategy to make Norwegian gas a global commodity.”

He emphasised that Cove Point would be a strategic building block in the group’s long-term work in acquiring a foothold in the rapidly growing US gas market. Statoil has an agreement with Dominion to land 10.4 billion cubic metres of gas per year at Cove Point over a period of 20 years.

“The expansion of the terminal means that we can continue to increase our deliveries of pure and reliable energy,” said Gary L Sypolt, transmission president in Dominion during the ceremony.

In his speech James A Slutz, deputy assistant secretary in the US Department of Energy, talked about the long and positive relationship between Norway and the USA. With a personal greeting from President George W Bush, he stressed Norway and Statoil’s important contribution to the security of energy supply to the US.

Mr Slutz added that imported LNG today accounts for 3% of the US gas supply. Cove Point, which is the largest terminal in the USA, accounts for 35% of LNG imports. In the next few years, LNG import capacity will be doubled. He also stressed that increasing LNG imports was an important contribution to ensure the US supply and security of energy.

Representatives of the Maryland and local authorities emphasised that increasing the capacity to receive Snøhvit gas will also mean major value creation by way of secure and well paid jobs and tax revenue.