Norway Agrees Terms with Private Firms for $1.6B Gas Export Network Takeover
November 12, 2024
Norway has reached a deal with seven private owners for a government takeover of much of the country's extensive gas pipeline network, the Norwegian energy ministry said on Tuesday.
Norway in 2023 announced plans to nationalise most of its vast gas pipeline network, a major processing plant and other infrastructure when many existing concessions expire in 2028, and had invited current owners to negotiate a transition.
The government agreed to pay the seven owners 18.1 billion crowns ($1.64 billion) for their assets.
Norway is Europe's largest gas supplier following a sharp fall in Russian deliveries triggered by Moscow's full-scale invasion of Ukraine in 2022.
The Nordic country's centre-left government regards the pipeline network stretching some 9,000 km (5,600 miles) along the seabed as an asset of national interest over which it wants complete state ownership.
While seven companies came to an agreement with the government, two groups rejected the offer.
Much of Norway's gas transportation pipeline network is owned by Gassled, a partnership set up in 2003 by oil companies that were producing gas offshore Norway at the time.
The agreement lifts the Norwegian state's stake in Gassled to 100% from 46.7% previously.
A government takeover will support the main objectives of Norway's petroleum policy, including low tariffs for the users of the pipeline network, the ministry said in a statement.
The energy ministry agreed terms with Shell, CapeOmega, ConocoPhilipps, Equinor, Hav Energy, Orlen and Silex to take over their shares in the joint ventures, it said. The agreement is backdated to Jan 1, 2024.
Equinor will retain a small remaining stake in the Nyhamna processing plant and Polarled.
North Sea Infrastructure and M Vest Energy, who hold ownership shares in Nyhamna and the Polarled pipeline, did not agree to a sale and maintain their stakes in both assets.
However, the government still aims to take over these stakes either when the current concession period ends or if a deal is agreed before then, it said.
($1 = 11.0660 Norwegian crowns)
(Reuters - Reporting by Nora Buli, Editing by Terje Solsvik and Alison Williams)
