Statoil is betting that aggressive exploration off Norway and further development of the gas value chain will strengthen the company's position as a secure gas supplier to Europe.
This was one of the key messages Rune Bjørnson, executive vice president for natural gas, delivered to the European Flame conference in Amsterdam. "We occupy a strong place in a growing European gas market," Bjørnson said. "We sold 52.4 bcm from the Norwegian continental shelf in 2004. This represents an increase of roughly 13% compared with the year before, and our highest gas sales ever."
These figures include Statoil's own gas as well as the volumes it sells on behalf of the Norwegian state's direct financial interest (SDFI).
"Natural gas will remain an engine for growth in our group," Bjørnson said. "Based on existing contracts, our gas sales are set to grow by an average of 9% annually from 2004 to 2007, and by 4% from then to 2010."
Bjørnson referred to forecasts from the International Energy Agency (IEA) that indicate global gas consumption is likely to almost double over the next three decades. The agency expects consumption to increase from 2,622 bcm in 2002 to 4,900 bcm by 2030. It also estimates that the investment in infrastructure required to reach such a level of supply will be no less than $2,700 billion, or $100 billion per year.
"The IEA says that the world's gas resources can easily meet the predicted growth in demand," Bjørnson said. "We don't necessarily agree with that. Where Europe is concerned, some of the present gas supply cornerstones will experience declining production when we look ahead to 2015 and 2030. This fall in output is currently a fact on the UK continental shelf, and will eventually also happen with major Russian and Norwegian fields." That would make Europe increasingly dependent on imports.
Bjørnson emphasized that the authorities at national and European levels can make a positive contribution to supply security. That would require them to ensure predictable fiscal frameworks and a regulatory regime that promotes the elimination of bottlenecks and the development of new capacity. On Statoil's behalf, Bjørnson stressed that the company aims to maintain and strengthen its position as a secure gas supplier to Europe. Key elements in this commitment include a record level of exploration and a substantial investment in infrastructure projects.
Statoil's strong position as a supplier of Norwegian pipeline gas to Europe will be supplemented in coming years by a growing involvement in additional areas. These include the production of gas in other countries, such as Algeria and Azerbaijan, and supplying liquefied natural gas from the Snøhvit field to the US.
02/22/05
