The North Sea - the new frontier of energy transition?

Checked against delivery. 

Ladies and gentlemen,

I want to thank the ONS Organization for giving us the opportunity to discuss the challenges we are facing in a troubled and extraordinary time for Europe and the world.

As Prime Minister Støre pointed out in his opening statement:

Trust is vital to international cooperation and to solve our global challenges.

Russia’s invasion of Ukraine’ is a direct attack on our rule-based international order.

The invasion is also an attack on trust.

In addition, it has changed the global energy landscape.

We must tackle these developments, in the middle of the energy transition.  

Last year, the global energy markets got tighter.

Energy production could not meet the increased demand.

Reduced gas supply from Russia has greatly affected the energy market. A tight supply of gas and LNG has pushed prices to historic levels. And we see a stronger push for more renewables.

We must secure affordable energy for households and businesses, in both the short and the longer term. This requires trust between countries.

At the same time we must reach our climate targets.  

Europe is now working towards independence from Russian energy. With the uncertainty of future Russian supplies, gas from Norway has become even more important for European energy security.

The companies on the Norwegian Continental shelf are already producing close to maximum capacity.

I am very proud of how the industry in Norway has responded, especially when keeping in mind the aftermath of the pandemic. Norway will keep on motivating these companies to maintain high production and exports.

I can assure you all:

We will remain a stable and predictable supplier of oil and gas to Europe and the international markets.

These markets are still dominated by fossil fuels.

Gas and oil especially will play a key role for decades to come. 

To meet the demand, more investments are needed.  

Norway is the largest producer of oil and gas in Western Europe, and the only net exporter.

In recent years, Norway has supplied up to a quarter of the combined gas demand in the EU and the UK. That share is now rising.

We have a mutual interest in the Norwegian petroleum sector being further developed.

I welcome the change in several European countries to allow for more oil and gas production in Europe, and the EU countries’ support for Norway’s continued exploration and investments.

We are also encouraged by the potential for cooperation on offshore renewable energy, hydrogen and carbon capture and storage.

Energy transition is still urgent.

As other commodities, oil and gas, must be produced with a lower carbon footprint. We also need to produce more renewable energy and increase energy efficiency.

Norway is in a good position to deliver. In the oil and gas sector, we have had strict restrictions in place to reduce emissions for decades. On average, emissions per unit produced on the Norwegian Continental Shelf are already low.

Our production is competitive, both in terms of costs and emissions. Yet, we work to improve further towards net zero in 2050.

In our government platform, we have made it very clear that we will develop the Norwegian petroleum industry.

That means we will facilitate more exploration and provide a predictable framework for the industry.

By doing so, we expect a continued high level of activity on the Norwegian Continental Shelf.

These policies help generate trust between the state and the private sector. For companies to take investment decisions in new production capacity, this trust is vital.

Transition means change.

As we handle the current energy crises, we must still tackle the climate challenges.

We must reduce emissions, increase production of renewables, and develop technologies for new industries.

My government has great ambitions when it comes to energy transition.

In the development of new industries and technologies, we will use our competence and capacity - and build on our deep offshore knowledge.

We see the North Sea as a central hub for this transition.

Energy policies in Europe, and the rest of the world, have a strong focus on increasing production of renewables.

Even more so after the invasion of Ukraine.

In Norway, we have a good starting point. Our electricity is already renewable. Norway is also highly electrified: in industry, for heating purposes and in transport. 

However, further electrification is needed, even here.

We need more renewable electricity at affordable prices, more infrastructure, and we need to use all our energy efficiently. 

 

Efficient cross-border electricity trade enables more efficient use of our resources and better utilization of the energy systems. This benefits both the trading countries and the European electricity market.

 

In order to succeed in the energy transition, Norway must use our advantages and competence coming from decades of experience to develop new business areas, such as offshore renewable energy.

       

With our offshore oil and gas and maritime experience, Norwegian companies can play an important role in developing floating offshore wind.

One example is Hywind Tampen. Coming into operation later this year, it will be the world’s largest floating offshore wind park.

And as you know, two large areas for offshore wind have been opened - "Sørlige Nordsjø II" and "Utsira Nord".

We aim to start the tender process for these areas next year.

In addition, we want to award areas for 30 gigawatts offshore wind by 2040 – and we have already started the process of identifying new areas suitable for offshore wind deployment.As a supplement to renewable energy, carbon capture and storage is a critical part of the world’s low-carbon energy portfolio.

For some industries, CCS is one of few available technologies to reduce emissions. We need to speed up and make CCS commercially available.

The government is firmly committed to developing a robust value chain for CCS in Norway. We have 25 years of experience with safe and reliable storage of CO₂ on our continental shelf. The Longship project is under construction, and we can already see positive effects from this effort.

Over the last year we have seen a substantial increase in the interest for CCS. And just yesterday the world’s first commercial agreement for transport and storage of carbon across borders was signed between Northern Lights and Yara. Hopefully it is the first of many!

I am confident that CCS will help us to reach the global climate goals.

And the Norwegian government wants to help make it happen by offering safe storage capacity through awarding licenses to commercial players.

As for hydrogen, we also see some interesting opportunities in the potential development of a market.

Hydrogen as an energy carrier could be important for the energy transition.

To achieve this, we need technologies that cut production costs and reduce loss of energy. We also need to expand the market with new areas of application.

Hydrogen will never be as energy efficient as direct use of electricity or natural gas. But it can play an important role in hard-to-abate sectors.

We are well positioned for taking part in hydrogen value chains:

Our electricity mix is almost 100 percent renewable, and we produce natural gas close to the European markets.

The Norwegian government believes in developing a value chain for hydrogen where production, distribution and usage are developed in parallel.

The industry is working to discover and develop more gas. We have suitable locations for safe storing of CO₂ offshore, and we have potential buyers of hydrogen in industry and the maritime sector.

There are several interesting hydrogen projects - both blue and green - in different stages of development in the industry. Blue hydrogen is regarded as the realistic alternative for large scale production in the short term.

In the longer term, production of hydrogen could be coupled with production of renewable power from offshore wind in Norway.

Ladies and gentlemen,

The world needs more energy, it needs cleaner energy, and it needs reliable energy supplies.

Norway will continue to be a reliable long-term provider of energy.  Both of oil and gas, and renewables. 

We will stand by Europe in these difficult times. You can trust us on that. Thank you for your attention!