Norway Advocates 'Zero-Emissions' for Arctic Oil
NORWAY: May 12, 2005


OSLO – Norway believes its "zero emissions" policy for oil and gas activity in the Arctic should be adopted internationally, the country's oil minister said on Wednesday before a visit to neighbouring Russia.

 


Norway and Russia share a sea boundary in the Arctic Barents Sea, which is believed to contain vast petroleum resources. Energy firms are increasingly turning their gaze north to the Barents as North Sea oil becomes depleted.

Norway requires drilling in its part of the Barents to have "zero emissions" of oil, drilling fluids or chemicals. But environmental groups have said leaks this year by a Norwegian drilling rig show that industry cannot meet the demands.

"We have the world's strictest emissions policy with zero tolerance," Oil and Energy Minister Thorhild Widvey told a briefing for foreign journalists. "Exploration has to be in line with environmental and fisheries' interests."

"I think it should be a goal for all countries that want to take part (in developing the Arctic) to have a zero emissions policy," Widvey said.

But she added: "I can't set demands for other countries. I can only set demands off Norway."

Widvey will visit Moscow on May 16-18 and meet Russian officials including the energy and natural resource ministers. She said she would use the visit to "put in a good word for Norwegian oil companies and the supply industry."

Norway is the world's third biggest oil exporter after Saudi Arabia and Russia and western Europe's largest natural gas producer. Norwegian oil firms Statoil and Norsk Hydro are looking to Russia's Arctic for opportunities.

"Off Norway, we've produced a third of our oil and gas so far, a third has been found and a third not yet found," Widvey said. A third of the amount not found is thought to be in the Barents, or 7.5 billion barrels of oil equivalent.

"The problem is to find it and to develop it in a profitable way," she said.


ENERGY FOR RISING DEMAND

According to some official estimates, a quarter of the world's remaining petroleum resources may lie in the Arctic.

"If we're going to manage to meet rising energy demand, I think that eyes are turning northwards. The Americans, the Russians and the Europeans are looking north," Widvey said.

"I can't rule out that the Barents will be Europe's main petroleum province in future," she said.

Norwegian oil companies resumed exploration in the Barents Sea this year after the government ended a ban that halted drilling in 2001 pending an environmental impact study.

So far, Statoil's Snoehvit gas field, due on stream by late 2006, is the only development in the Norwegian sector of the Barents Sea that has been deemed commercially viable and reached the building phase.

Statoil is drilling its first Barents well since the ban ended. It resumed the work this month after a leak of 1.6 cubic metres of hydraulic oil from the Eirik Raude rig in April halted it and provoked an outcry from environmentalists.

Smaller rival Norsk Hydro drilled a well in the Barents earlier this year, but found only traces of oil, not producible amounts.

Both companies are also vying with western oil majors to participate in Russia's huge Shtokman gas field.

 


Story by John Acher and Alister Doyle

 


REUTERS NEWS SERVICE