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CHP plant at Mongstad

October 12, 2006, 19:45 CEST

A combined heat and power (CHP) plant is to be built by Statoil at Mongstad near Bergen following the receipt of a carbon dioxide emission permit from Norway’s Ministry of the Environment.

The group has already secured a licence from the Norwegian Water Resources and Energy Directorate to build this facility at the site, where it has a refinery and crude oil terminal.

Statoil has also concluded an agreement with the Ministry of Petroleum and Energy on developing solutions for future carbon capture.

Under this deal, the government accepts the principal responsibility for meeting the cost of capturing, transporting and storing carbon dioxide.

The CHP plant represents a strategically important project which will also help to improve the electricity supply position in the Bergen region.

“It’s gratifying that the ministry has given us an emission permit for a good environmental and industrial development,” says Jon Arnt Jacobsen, executive vice president for Statoil’s Manufacturing & Marketing business area.

“Heat from the CHP station will substantially enhance energy efficiency in the refinery and thereby strengthen its profitability. The frame conditions give us competitive terms.”

Construction of the new power station will lay the basis for strong development of the refinery as well as of industry in the rest of the region.

Its annual output will correspond to 2.3 terawatt-hours (TWh), equivalent to two per cent of overall Norwegian electricity generation in a year with normal precipitation.

Fuelled by surplus gas from the refinery and natural gas from Troll in the North Sea, the CHP plant will provide 350 megawatts of heat for use in the refinery and 280 MW of electricity.

Plans call for the CHP plant to come on line in 2010. Statoil has concluded a 20-year agreement with Dong Energy, which will own, build and operate the facility.

This development will be paralleled by work to devise technical and commercial solutions for managing carbon dioxide at Mongstad.

A mutually binding agreement between Statoil and the Ministry of Petroleum and Energy covers the development of technology which can provide good and cost-effective solutions.

The main economic and operational responsibility for establishing carbon capture, transport and storage rests with the Norwegian government.

Carbon management will be developed in two stages, starting with a capture facility providing an annual capacity of 100,000 tonnes. This will be followed by a large-scale installation.

Statoil is due to draw up plans by 2008 for managing the major carbon emissions from Mongstad, with an investment decision for a large-scale capture plant expected to be possible by 2012.

“Technology for managing carbon dioxide is important for us,” notes Mr Jacobsen. “A series of projects has made us a pioneer for such projects.

“These include the Sleipner area in the North Sea, Algeria’s In Salah field, the Snøhvit development in the Barents Sea and the Halten carbon dioxide venture in the Norwegian Sea with Shell.

“Developing new capture solutions for Mongstad will confirm our position as an international leader for carbon management.”

Further information from:
Catherine Torp, vice president public affairs, Statoil ASA, tel: +47 41 56 02 64