Minister of Foreign Affairs Jonas Gahr Støre

German – Norwegian Dialogue on the High North

Berlin 26 January 2006, DGAP - Deutsche Gesellschaft für Aussenpolitik

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Liebe Freunde, es freut mich sehr wieder in Berlin zu sein. Ich bin auch sehr froh, hier vor Ihnen reden zu dürfen.

Herr von Nordenskiöld, ich möchte Ihnen danken, dass Sie in Zusammenarbeit mit der Botschaft dieses Seminar ermöglicht haben. So passt es auch gut, dass dieser schöne Saal sich in der Rauchstrasse befindet – gleich gegenüber dem ehemaligen norwegischen Legationsgebäude in der Rauchstrasse 11 – wo auch Willy Brandt kurz nach dem 2. Weltkrieg arbeitete als Offizier in der norwegischen Militärmission. Und nicht weit von den neuen nordischen Botschaften. Weil ich grossen Respekt für die Sprache Goethes und Schillers habe, bitte ich um Verständnis, dass ich jetzt zur Englischen Sprache übergehe.

Dear friends, it is great to be back in Berlin. My intention was to come earlier, right after Jens Stoltenberg’s government took office in October. But I agreed with my colleague Dr Frank-Walter Steinmeier to wait until the new German coalition was installed. This is now the case. And after yesterday’s talks I can confirm that Norway and Germany will continue on the path we have been following for so many years, one of close friendship and mutual understanding, with a common eye for emerging opportunities.

One such area of attention brings us together today: the challenges and opportunities emerging in the High North of Europe.

Let me give you the essence of my remarks right at the outset:

This may well be an emerging European energy region. This may well be the region where we develop a new chapter of developing cooperation with Russia, thus making an important contribution to wider European integration. Important decisions will be made as regards the choice of technology, as regards environmental standards, as regards resource management, routes and means of transport. And important decisions will be made when it comes to market destination – to Europe, America or both – by pipeline, ship or both.

It all amounts to opportunities in the northernmost part of Europe. And thus it belongs on the Norwegian-German agenda.

In November 2004 the Norwegian-German Willy Brandt Foundation arranged a “Gesprächskreis” on the High North. At the time I was invited in a private capacity to comment on High North matters and Norwegian-German cooperation.

Developments since then have highlighted the importance of this northernmost region of Western Europe. [ – “Auf nach Norden!” as the 19 ^th> century’s travel posters from German agencies said in large letters].

Let me reiterate two observations that I made at that meeting:

Firstly, knowing that Norway provides Germany with one third of its natural gas imports, I noted with interest the importance the Germans attached to long-term energy security. This is a concern that Germany shares with most other European nations, and perhaps more so now than two years ago. Prices have surged. The Middle East is still unstable. The recent energy supply crisis in Ukraine has brought the geopolitical significance of energy policy home to us all.

Secondly, I noted that Norway gives high priority to engaging in a close dialogue with Germany on the High North – the part of our “near abroad” that is changing most. The previous government decided to start a dialogue with Germany on this issue, and the present government is following the same line.

The reasons are many:

Germany is Norway’s ally. Germany is in the top league of Norway’s trading partners. During the second half of the 20 ^th> century, Norway and Germany developed relations based on mutual understanding and close political, economic and cultural ties. Germany is the largest purchaser of Norwegian natural gas, accounting for 35 per cent of Norway’s total gas exports.

German companies have been partners in the exploration and production of Norway’s energy resources. Today the German engineering enterprise Linde is playing a key role in the development of technology for the Norwegian gas field Snøhvit, which will shortly be the first field in operation in the Barents Sea. RWE-dea, which is represented here today by Mr Schöning, is also participating in this pioneer project in the High North. And many more small and large enterprises have been part of the development of the Norwegian petroleum saga and will continue to be.

Let us now turn to the High North, an issue that should be at the very core of the Norwegian-German dialogue.

Why this focus and why now?

From one perspective, there is nothing new about Norway welcoming the attention given by Western partners to the High North: the Barents Sea and the adjacent areas. There was, there is and there remains the question of interests.

At first this was based on security interests. During the Cold War it was in this area and in Germany that NATO bordered on the Warsaw Pact. We wanted our allies to focus on these areas where the Soviet Union had some of its major concentrations of military power.

Since the end of the Cold War the High North has gradually changed in character. From being an important area from a military and security policy point of view, it is now important because of its vast natural resources – energy sources and fish – and the opportunities for exploiting them in a sustainable and responsible manner.

But let us not forget as we look ahead and continue to free ourselves from the straightjacket of the Cold War, the security dimension has not disappeared. Norway still borders on a country with unstable democratic traditions. There is still a significant military arsenal in place.

But security is no longer pushing all other dimensions aside. The picture can be – or I should say is – broadened. Cooperation is expanded. New areas are covered.

Then there are the resources. Norway has cooperated with Russia for decades on the management of renewable resources. For centuries, people in the High North have made their livelihoods from the fish caught in these harsh waters – and it is our responsibility to safeguard this industry through wise, predictable and firm management of the Norwegian Arctic Cod. Norway and Russia are assuming this responsibility together.

I am pleased to note that Germany and Norway are equally eager to support the principles of sustainable management of the living resources of the ocean. This is of course very important since the globe has one marine ecosystem encompassing all states’ economic zones at sea.

The new dimension is about energy, oil and gas that is in demand in both Europe and America. A quarter of the world’s undiscovered energy resources may turn out to be in the Arctic, which extends all around the globe, south of the North Pole. Our interest of course is in the part that is adjacent to our region, an area that may become Europe’s most important energy province in the foreseeable future.

Whereas many of the world’s other energy provinces are characterised by conflict and unrest, the Barents Sea, rough as the weather may be, stands out as politically stable and peaceful.

Just how large are these energy resources? Further drilling is required in order to tell more precisely. Production has started in the Norwegian part of the Barents Sea and new resources are being located, although more exploration is needed. But we do know that the world’s largest offshore gas field has been discovered here: the gigantic Shtokman Field on the Russian side, some 500 kilometres north of Murmansk. If it is developed according to existing plans it is expected to produce the equivalent of half of Germany’s gas demand for more than 60 years.

Let me add that the Barents Sea is also a frontier in our joint encounter with climate change, which is most likely man-made. The effect of climate change is greatest around the poles. So may be the consequences. This region may give us the most telling signs of forthcoming changes, and our most compelling reasons for taking action. Therefore we need to highlight the environmental dimension and ensure that we have the world‘s most stringent environmental regulations for petroleum production in this area.

Now I have set the scene. It is about the future management of resources in vast geographical areas with Arctic conditions. It is also about managing relations with Russia – Norway’s relations with Russia and Europe’s and America’s relations with Russia. It is about keeping a sober eye on security while broadening the security equation to include new dimensions, not least economic matters, cultural matters and people-to-people matters.

The most important new dimension is energy. Just as security pushed most other issues aside during the Cold War, it is energy that is now gradually redefining the potential – and the stakes – attached to this region, as energy is pushing it way towards the top of most political agendas. The upcoming G8 summit in Russia is no exception.

For Norway, continuing to expand relations and cooperation with Russia will go hand in hand with continued close relations and cooperation with our Nordic, European and Atlantic partners.

The energy issue adds a new dimension to our relations with Russia. The boundary between Norway and Russia cuts across what may seem to be large petroleum deposits in the Barents Sea. But this boundary is still under discussion. Norway and Russia have been seeking to reach agreement on the delimitation of their economic zones in the Barents Sea since the 1970s. The area under dispute has shrunk as we have progressed in our negotiations. But there is still some ground to be covered. After a two-year pause, the negotiations resumed last December and my Russian colleague and I both intend to bring them further towards the final stage.

A clear boundary is key, in all circumstances, even between good neighbours, and especially when there are important natural resources to be managed and produced. There is an inherent potential for conflict in the combination of unresolved border issues and rich energy resources. We are therefore intent on finding solutions to the pending issues.

Norway and Russia also need to agree on key principles for the energy chapter that is now opening. We should agree on applying the best available technology in all our operations. We should agree on applying the most stringent environmental standards. This will enable us to fulfil the responsibility we have as coastal states in a region with a vulnerable environment. And experience shows that applying the highest standards not only protects the environment, it is sound business logic, it brings higher returns on investments and it yields more resources.

I would also like to add that in the field of nuclear safety and security Norway has had a constructive and concrete co-operation with Russia since 1995. During this period we have allocated more than EUR 135 million to projects in this field. In recent years other countries have also joined forces with Russia to help eliminate this legacy from the Cold War, which to a large extent is found on the Kola Peninsula, on Norway's doorstep. The G8 Global Partnership Against the Spread of Weapons and Material of Mass Destruction, in which Norway participates, has mobilised political attention and financial resources towards this area.

One of the G8's – and Norway's – main priorities in these efforts is the dismantling of decommissioned Russian nuclear submarines. Here the German financing of long-term intermediate storage for submarine reactor compartments in Saida Bay has been particularly valuable and complementary.

The marine resources in the Barents Sea know no borders. In Norway we are currently working on a comprehensive management plan for our part of the Barents Sea, including standards for petroleum exploration, transport and fisheries. Our vision is for a plan of this kind, developed in cooperation with Russia, to apply to the entire Barents Sea.

As I have shown, our intensified cooperation with Russia is more than a close bilateral relationship. It is part of a broader effort to link Russia more closely into European and Western cooperation structures.

Germany has played a major role in developing cooperation with Russia in areas to the south of Norway. We could supplement this by intensifying our cooperation in the north. In this sense our High North policy is an integral part of our European policy and part of our policy towards Germany. Given its strategic position and economic strength, Germany has a particular role to play in cooperation with Norway and Russia.

Cooperation between Germany and Russia has covered a broad range of areas, not least energy. We would like to draw on Germany’s experience. This is of particular interest as Norwegian expertise and technology may be applied on the Russian continental shelf. And in the future there should be prospects for cooperation involving all three countries. Norway, Germany and Russia.

The common denominator for Norway’s engagement in the High North will be a constant emphasis on knowledge. As a coastal state, we can accept nothing less than state-of-the-art knowledge on all dimensions of management and all fields of activity as our yardstick. The new Norwegian government has launched “Barents 2020”, a research and development programme to help spur the expertise needed to meet the major challenges we are facing in the north in terms of technology and management. A key focus will be on how to reconcile petroleum technology and environmental regulations.

The intention of “Barents 2020” is to mobilise the centres of excellence in Norway, and also to reach out to partners abroad. I am therefore inviting research institutions and companies from Germany to take part in the emerging research and development programmes on the High North.

Norway and Germany have broad experience of a variety of cooperation schemes. I would like to commend the Norwegian-German Willy Brandt Foundation for its efforts to involve Norwegian and German energy companies and authorities. I am aware that the Foundation, which includes energy companies from both countries, will be holding a meeting in Berlin in March to explore the possibility of launching concrete research and development projects in the High North. This I heartily welcome. We need to develop pilot projects. Later on these may also include our Russian partners.

Norwegian-German energy cooperation will also be spotlighted during the trade fair E-World in Essen next month. Norway will be one of the partner countries and will be represented by 25 companies.

Germany has developed and used environmentally safe technology extensively both at home and abroad, and has thus been playing a leading role in international cooperation on resources and the environment for a long time. You are also playing an important role in polar research, with the Alfred Wegner Institute and the permanent German research station on Spitzbergen.

We should reach out to Germany’s environmental expertise. This applies to research on the ecosystems in the north, which is a field where German scientists have made a big contribution, and to efforts to develop standards or rules for commercial activities.

Ladies and gentlemen,

These are some of the issues on the agenda for the Norwegian-German High North dialogue. Energy is high on that agenda. So is fish. And so is the whole question of climate change and environmental vulnerability.

Energy security is taking hold as a major preoccupation for most governments, not least in Europe and America. Norway is responding to this concern by recommitting to its role as a stable and reliable provider of oil and gas. You know us, you are familiar with the way we have developed our petroleum industry along the Norwegian coast towards the north. You know us as a predictable manager of the waters under our jurisdiction and a provider of stability in the High North. Together with our partners we are ready to work with you as we develop the world’s northernmost energy region.

New technological frontiers will be crossed, not least when it comes to the transport of oil and gas from the High North. The new LNG [Liquefied Natural Gas] technology makes it possible to transport gas in large tankers, eliminating the need for pipelines. From 2007, gas will be exported from the Norwegian Snøhvit field, just north of the world’s northernmost city of Hammerfest and transported to the east coast of the US as LNG.

A good deal of the gas from the gigantic Shtokman field in the Russian part of the Barents Sea will also be targeted at US markets. The possibility of building a terminal for LNG in the US is currently being discussed.

As far as I understand there are also plans in Germany to develop an LNG landing terminal in Wilhelmshaven. This could broaden the basis for natural gas supplies and thus open up for further diversification of channels for delivery of gas, including Norwegian gas, to the German market.

It is also likely that new pipelines will be built to transport gas from the High North to Europe. Russia is planning to build a branch pipeline from Viborg to Murmansk to connect the planned trans-Baltic pipeline with the High North.

But there is also another possibility. For many years Norwegian gas has been transported to Europe, particularly to Germany, through an advanced pipeline network in the North Sea. Extending this network from the Norwegian Sea all the way up to the Russian part of the Barents Sea would make it possible to provide gas reliably and efficiently to Western Europe utilising well-established infrastructure.

This is an interesting option as this network will have available capacity in 20 years’ time. Furthermore, Germany may be interested in having additional supply routes. There may be enough gas in the Barents Sea to exploit the capacity in both these pipeline alternatives.

But again, there are balances to strike and challenges to meet. It is inevitable that more oil and gas will be transported along the Norwegian coast. We must do everything possible to prevent serious accidents in these fish-rich waters. We need to consider transport routes at safe distance from the coastline. In addition to a large-scale emergency response system to deal with any accidents, we need rules that minimise the risks involved in oil and gas transport.

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I am very pleased that the German Council on Foreign Relations (DGAP) was willing to host today’s seminar. This is a fine setting for anchoring our dialogue on these issues, which cut across academic and political disciplines. I am confident that the Council will continue to follow the evolving High North agenda, just as the Stiftung Wissenschaft und Politik (SWP) and the Friedrich Ebert Foundation have.

German researchers have travelled to the High North. We will invite other key people in Germany – perhaps some of you – to follow suit. Representatives of the relevant German institutions and of other countries that are key partners in our High North policy will also be invited. The first of a series of visits to the High North will be arranged in the middle of June this year.

Developing the High North requires sober analysis. But also the ability to think along new lines and be aware of the large perspectives that are opening up. This year we are commemorating the centenary of the death of one of the world’s greatest dramatists, Henrik Ibsen. Ibsen, who wrote his most important works during his 27 years of voluntary exile in Italy and Germany, including here in Berlin, he saw it as his major responsibility to trigger Norwegians to think big. We are thinking big as we support the staging of new productions based on Ibsen’s plays around the world in 2006. And together with you we are ready to think big – and wisely – as we shoulder our responsibility for developing one of Europe’s most exciting regions for the benefit of future generations.

Returning to our stage of today and to the theatre of international politics, I wish you all a fruitful seminar and long-lasting Norwegian-German ties in the High North.

Und hiermit ist dieses Seminar geöffnet! Ich wünsche Ihnen einen interessanten Tag mit angeregten und gegenseitig inspirierende Diskussionen.