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Tuesday, May 21, 2024

Gas production may increase after all

Norway hasn’t been able to offer more of its North Sea gas to help ease the energy crisis in Europe, since North Sea production and daily exports are already running at full capacity. Now, however, the government is adjusting production allowances at three major gas fields that can boost gas deliveries this summer.

Norway’s Oseberg field in the North Sea is among those being allowed to increase production of gas so that Norway’s total production at today’s high levels can be maintained through the summer. Subsequent deliveries can help replenish dwindling European supplies. PHOTO: Equinor/Øyvind Hagen

The Oseberg, Troll and Heidrun fields will all be allowed to continue producing at current levels after this winter and early spring, when demand is highest. Production normally declines through the summer, when demand is lower, but not this year when Russian gas has been cut off from the market after Russian President Vladimir invaded Ukraine and started a war.

Europe and especially Germany are hit hard by the absence of Russian gas. Most agreed they’d become far too dependent on Russia as a supplier and now they’re literally paying a very high price to refuse to buy Russian gas as a matter of principle.

Norway is left as the only European supplier but can’t replace all the Russian gas. Now it hopes to at least be able to maintain the current level of deliveries.

“The fields on the Norwegian Continental Shelf are producing as much gas as they can, or very near that,” says Norway’s new Oil & Enegy Minister Terje Aasland. “For us, it’s important to make it possible for the companies to maintain today’s high production, also moving forward. We’re doing that through the new measures for Oseberg, Troll and Heidrun.”

Norwegian gas is delivered to Europe through a vast gas transport system, and can cover up to 25 percent of the demand for gas in the EU and Great Britain. Gas from the Snøhvit field not far from Hammerfest is sent to market via ship. Increased imports of Snøhvit’s gas will also become more important for Europe when its production cranks up again on May 17th, following a serious fire at its gas processing facility.

The ministry stated that Norway “can make an important contribution in the current situation (as war rages in Ukraine) by upholding today’s high production of oil and gas every day, and through ongoing high regularity in the delivery chain.”

It will also mean even more windfall revenues and profits for Norway, which is being called upon to direct lots of the unexpected revenue towards more aid for Ukraine and relief tied to other dire consequences of Russia’s invasion. Berglund



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