Speech at Norwegian Offshore Energy Week

                                                                                        Check against delivery. 

 

Ladies and gentlemen,
Industry leaders and friends,

It is a great pleasure for me to open the Norwegian Offshore Energy Week.

Norway has the experience, expertise and business infrastructure to meet the challenges facing the energy industry.

I hope that this event will provide an opportunity to consider possible ways of dealing with new challenges in markets throughout the world.

We meet at a particular time, with the coronavirus influencing daily life, financial markets and supply chains in Norway and all over the world.

We must all do our part to contain and limit the effects, but also stand ready to tackle the short and medium term consequences.

The Government is monitoring the situation closely and engage where we can and should as the situation develops.

Let us still use this event to focus on the long term perspectives for offshore energy.

We know that the world’s growing population will need more food, medicines, renewable energy, and minerals.

If managed wisely, the oceans are key to meeting many of these needs.

Millions of people have been lifted out of poverty and have attained a decent standard of living in recent decades.

Affordable and clean energy is crucial for sustainable global development.

However, far too many people throughout the world still do not have access to electricity.

More energy is needed so that they can achieve a decent standard of living.

There are, however, problems involved in ensuring energy for all.

60 per cent of global greenhouse gas emissions are from energy use, and the level of emissions has never been higher.

What we need, then, is both more energy and lower emissions.

Changing the complicated global energy system is going to be incredibly difficult – but it is possible.

Norway can be part of the solution.
Our offshore energy sector is willing and able to play a role in the transition ahead.

We have 50 years of experience in developing our petroleum resources offshore.
During those 50 years, a vast, globally competitive supplier industry has developed in Norway that provides sophisticated technology and solutions.

We believe this industry will continue to provide innovative solutions for our offshore industry, as well as in new markets and segments outside the petroleum industry.

In fact, many of these companies have already begun to do so.

 

Wind has powered ships at sea for centuries.
Now modern technology is providing new opportunities for wind-based energy.
For coastal states and island nations, the prospect of generating renewable energy from windmills offshore is attractive.

Offshore wind can help secure some of the clean renewable energy we are going to need in the years ahead.

The challenges to offshore wind solutions vary according to location.
Bottom-fixed wind farms are already operating at scale off the coast of the UK.

However, establishing them has required subsidies other countries may not be able to afford.
In other places, water depths prohibit using bottom-fixed turbines.

Turbines on giant floating installations may then be a feasible option. However, the costs are still too high for floating solutions to be competitive in any market.

These are examples of some of the obstacles that I am sure you will be discussing over the next few days.

I encourage you to tackle these challenges head-on. Because we know the world is going to need much more renewable energy in the future – and you can be part of the solution.

 

Norway is well-placed to do its part.
In 2019, the share of renewables in our total energy consumption was an impressive 72 per cent.

This is mostly due to more than a hundred years of hydroelectric development, but hydropower has been supplemented recently by onshore wind.

In Norway, we believe there will be greater reliance on electricity in the future – particularly when it comes to transport systems.

My Government has promoted this transition by granting tax exemptions on electric vehicles and supporting the maritime industry in adopting electric vessels, while making sure that there are still plentiful supplies of renewable energy.

I hope that Norway can lead the way in terms of electric mobility.

 

I am often asked about the role oil and gas can play in an electric future.

My answer is that even if we meet the targets set by the Paris Agreement, there is still going to be a significant demand for oil and gas – even though our drive for electrification will further lower the demand for fossil fuels.

There will still be a need for petroleum, but at much lower levels than today. This view is supported by both the IPCC and the International Energy Agency.

Many of our biggest oil fields are now in a mature phase, and resources are being depleted faster than we are able to find new ones.

In a low-carbon future, I believe that lower emissions from the production of oil and gas will be important.

I am encouraged by the ambitious targets set by the Norwegian oil and gas industry to cut emissions from production, and their aim to reach near-zero emissions by 2050.

We know that our policies are producing good results.
The carbon footprint of Norwegian production per barrel is about half the global average.

Electrification also plays a key role in the strategy to cut emissions on the Norwegian continental shelf.

Offshore wind can be an important source of renewable energy for the platforms and subsea installations in the North Sea.

Testing out larger-scale floating wind installations, as Equinor’s Hywind project is doing in the Tampen area, is an important first step.

I am pleased that government funding through Enova is helping to make this project possible.

The Hywind Tampen project is proving something important:
It shows that we can use the expertise and technology of the oil and gas industry to develop new solutions for the future.

These results and these new ambitions are the result of much hard work, technological development, bold leadership and large investments.

We will need more of all these things in the time ahead.

According to a report on offshore wind from the International Energy Agency, offshore wind could be a thousand billion dollar industry by 2040.

Offshore wind is already Norway's largest renewable export industry – and it has the potential to become a new industrial success story.

The Dogger Bank project, which provides electricity to 4.5 million households in the UK, is a good example.

Equinor, one of the developers, and suppliers such as Aibel and Offshore Heavy Transport, have all won contracts in this project, in the face of tough competition.

In September last year, I invited executives from industry, research institutions and key organisations to a roundtable discussion of offshore wind in Bergen.

The discussion focused on industrial development, and highlighted Norwegian expertise as well as global market opportunities.

In the autumn, the Ministry of Petroleum and Energy conducted a public consultation on the proposal to open two areas for offshore wind development.

Among the roughly 300 respondents, many were concerned about the impact of offshore wind production on birdlife and fisheries.

Others called for increased state funding in order to stimulate developments in offshore wind technology.

Offshore wind development in Norway will not be without its challenges.

On the one hand, there is no doubt that we have the competence and industrial expertise to be leaders.

On the other hand, we have a substantial surplus of clean renewable energy already.

High investment costs are certainly a barrier to offshore wind development.

The difference in cost between onshore and offshore wind power is still considerable.

Costs need to come down for offshore wind to be competitive, particularly in the Norwegian market. 

 

However, the pace of technology development may surprise us. As we have seen in solar and onshore wind, there has been a sharp decline in costs over the last few years.

My Government is keen to see this industry develop and thrive as we seek to meet an increasing global demand for cost-effective and forward-looking solutions.

 

From carbon capture and storage to offshore wind, the potential for future development in Norwegian waters is vast.

We would never have been in this position without the knowledge and experience we have gained on the Norwegian continental shelf.

Our history of activity on the shelf – and in the laboratories and workshops onshore – is also a history of cleaner and more efficient production.

We recently marked the start of production from the Johan Sverdrup field.
Thanks to renewable power from the mainland, the amount of CO2 emitted is only 700 grams per barrel.

Which is particularly impressive when we know that the world average is 18 kilos.

I would like to highlight some of the key Government policies supporting offshore energy.

Firstly, we are committed to maintaining a stable and predictable framework for the petroleum industry.

Secondly, we will continue to support research and development in order to increase productivity and recovery rates, and to reduce costs and emissions.

The Norwegian Government has increased overall R&D spending for several years, and research in offshore wind alone has been allocated more than 500 million kroner over the past 10 years.

Last month, our Minister of Petroleum and Energy, Tina Bru, received a report from Rystad Energy on the effectiveness of government-supported petroleum research programmes.

The report concluded that these research programmes have led to increased value creation, cost reductions, new jobs – and innovative technologies to reduce the environmental and climate impact of these industries.

Thirdly, we want to strengthen the international competitiveness of our energy industries.

Institutions such as Innovation Norway, Export Credit Norway and the Norwegian Export Credit Guarantee Agency promote exports and global investments in energy, ranging from oil and gas to renewables.

Norwegian Energy Partners, our hosts for this event, share the aim of strengthening the position and competitiveness of the energy industry internationally.
They have brought us together to discuss future challenges and opportunities.

NORWEP is our most important tool for bringing innovative and climate-friendly energy solutions developed in Norway to a growing global market.

Today, more than two-thirds of Norway's export revenues come from ocean-based activities – fisheries, aquaculture, shipping and energy production.

With our legacy, experience and forward-looking approach, offshore energy is at the heart of Norwegian industry and future value creation.  

I wish you a prospective and productive offshore energy week in Oslo.

Thank you.