The Norwegian government plans to increase domestic gas consumption through a stage-by-stage development of the market.

This decision emerges from a white paper on innovative efforts to support environment-friendly gas-fired power technologies, which was presented Aug. 6, 2004. "Markets for natural gas in Norway are small and spread over a number of locations," the policy document says. "Delivering gas by ship will therefore often be the most appropriate solution."

The document also concludes that LNG could be sold in Norway at prices that 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," Einar Stømsvåg, acting head of Statoil's manufacturing & marketing business area, says. "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."

Stømsvåg emphasizes that an important condition for developing the Norwegian gas market is that the instruments in place to support the creation of receiving terminals are retained.

8/6/04