Tuesday, September 29, 2020

Gassco Urges to Boost Barents Sea Gas Export

January 14, 2020

Minister of Petroleum and Energy Sylvi Listhaug receives the report on gas transport from CEO of Gassco, Frode Leversund (left). Kjell Agnar Dragvik, Director Analyses and framework at the NPD, also attended the presentation. Photo: Norwegian Petroleum Directorate (NPD)

Norwegian state-owned natural gas pipelines operator Gassco published a study saying that  it could be profitable to increase the transport capacity for gas.

According to the study regarding the transport of gas from the southern Barents Sea several gas transport options from the Barents Sea, including a new pipeline, could prove profitable with today’s known resources.

The report, "Assessment of gas transport alternatives in the southern Barents Sea", was presented to Minister of Petroleum and Energy Sylvi Listhaug on Monday.

The Norwegian Petroleum Directorate (NPD) contributed in the preparation of the report. The objective was to prepare a broad and up-to-date factual basis in order to assess the opportunities for greater value creation associated with increased transport capacity for gas from the southern Barents Sea.

The study's two most important observations are: 1) Increased gas export capacity will facilitate greater value creation from fields and discoveries where resources have already been proven, and 2) Investments in new gas transport capacity could facilitate greater value creation from both proven and undiscovered resources.

The report provides a broad factual basis and proposes joint solutions that could contribute toward further developing natural resources in the Barents Sea region. Gas export from the Barents Sea currently only takes place via the Snøhvit LNG plant on Melkøya.

Current capacity at the Melkøya LNG plant will be fully utilized through 2050 based on volumes from fields in operation and from discoveries under development.

The NPD assisted Gassco in the assessments of the resource base for fields and discoveries, and developed separate scenarios for undiscovered resources. These show that there may be a need for new transport capacity before 2050.

"Increased transport capacity could prove important in realizing the value of the already discovered gas. We are projecting significant remaining gas resources in the southern Barents Sea, and new infrastructure could help stimulate additional exploration. We therefore support the recommendation to continue the work and mature projects for increased gas transport capacity," said NPD Director General Ingrid Sølvberg.

In contrast to previous studies, the analyses in the report show that multiple gas transport alternatives could also be profitable – based solely on proven resources. If undiscovered resources are included, even larger solutions could also be profitable. The report also shows that simpler solutions for gas transport and technology development will help reduce development and operating costs.

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