UK Prime Minister Agrees Major Energy Partnership with Norway

Prime Minister David Cameron and the Norwegian Prime Minister Jens Stoltenberg agreed a landmark energy partnership between the UK and Norway designed to secure affordable and sustainable long term energy supplies.

The Norway-UK Energy Partnership for Sustainable Growth heralds closer collaboration between the two countries across a wide range of energy activities, including safe and environmentally sensitive oil and gas extraction, long term gas supply, renewable energy investment, electricity interconnection and international climate change policy development.

Alongside this agreement UK and Norwegian companies have announced billions of pounds of new investment with the potential to create thousands of new jobs.

Commenting at a breakfast meeting attended by ten leading energy companies from the two countries, with combined annual revenues of more than £400 billion, Prime Minister David Cameron said:

“The jobs and investments announced today highlight how vital the strong relationship between Norway and the United Kingdom is for our energy security and economic growth. We look forward to strengthening our partnership further, driving investment into a diverse, sustainable energy mix that delivers affordable long term supplies for consumers.”

Commercial announcements include:

– Norwegian global oil services firm Aker Solutions will create 1,300 new highly skilled jobs by 2015 at its engineering hub in Chiswick. This comes on top of 1,000 new jobs it has already created in the UK over the past two years;

– Statoil intends to invest a further £12 billion over the lifetime of the UK’s Mariner-Bressay North Sea oil fields in addition to the £6 billion they have already announced. This will lead to the creation of up to 300 new jobs in the UK in the next few years, including at a new operations base in Aberdeen, in addition to 700 UK jobs from this investment that have already been announced;

– A new Memorandum of Understanding has been agreed between Statoil and Centrica to continue cooperation on gas supply and exploration. This builds on the £13 billion, ten year gas supply deal agreed between the two companies last November and follows the recent completion of a £1billion asset deal between the two companies that will increase Centrica’s oil and gas reserves by 29 percent;

– The Forewind Consortium, which includes Norwegian companies Statoil and Statkraft, has confirmed its intention to develop the 9GW Dogger Bank offshore wind project off the East coast of Yorkshire, which could require up to £30 billion of investment. This project could provide more than 10% of the UK’s electricity needs. In addition to this project Statoil and Statkraft are investing around £1billion in developing the Sheringham Shoal offshore wind farm off the coast of Norfolk, which is already generating power and will be completed later this year. It will provide power to more than 200,000 UK homes when fully operational. The project employs 500 workers in the field and provides significant secondary employment;

– Good progress is being made in two projects to build one of the world’s longest subsea electricity interconnectors between the UK and Norway, which will enable the UK and Norway to share renewable energy resources, with each project worth over £1 billion: NSN (National Grid and Statnett) and NorthConnect (SSE, Vattenfall, Agder Energei, E-CO and Lyse);

– A deal between Shell and Gassco to strengthen UK energy security by providing British customers with more gas from Norway. By making better use of spare capacity in the UK gas transport system, Norwegian gas owners and transporters, including Shell, will be able to transport more gas from Norwegian fields via the Tampen Link to the FLAGS pipeline into St Fergus.

Charles Hendry, UK Minister of State for Energy, added:

“For many decades Norway has been one of our most trusted and valuable partners, working with us to develop North Sea resources that underpin our energy security.

“The investments and jobs announced today by British and Norwegian companies are a clear signal of the benefits of this partnership.”

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Offshore WIND staff, June 07, 2012; Image: decc