The World Future Energy Summit, Abu Dhabi 22. januar 2008

Deputy Minister of Petroleum and Energy Liv Monica Stubholt

Introduction
Excellencies, Ladies and Gentlemen,

In public debates today, the words OIL and GAS often appear in the same context as grave concerns over e.g. corruption, energy poverty, human rights and the global environment being expressed. A disinterested observer may be led to believe that hydrocarbons constitute a dangerous substance indeed, which should be avoided and or restricted at all cost. I beg to differ. 

It is true that some countries struggle to distribute the wealth generated by petroleum production in a fair and democratic manner. It is a fact that some of that wealth is stolen by way of corruption. We believe petroleum companies and countries should partner in fighting corruption and foster fair and democratic use of the petroleum income. Norway promotes the Extractive Industries Transparency Initiative in that regard. 

It is also true that the production of petroleum contributes substantially to the emission of green-house gases. The petroleum industry is being called upon to do its share as part of urgent climate policy.

It is furthermore true that lack of energy prevents millions of people from realizing their potential. Let me start there.

Energy demand
The fact is: The world needs energy. Fossil fuels will remain the main source of energy. Security of supply is a key issue.

Countries rich in fossil fuels will contribute to meet the global demand for energy to ensure growth and to bridge the poverty gap. We are being challenged to produce and consume as cleanly as possible.
   
It is necessary that we welcome, promote and contribute to fund research, innovation and technologies that will help us mitigate climate change. Firstly, this requires increased focus on renewable energy such as hydro power, wind power, sun power and biomass as well as energy efficiency. But we must meet the challenge of securing a sustainable future energy supply by reducing the emissions from the production and use of fossil fuels. Carbon capture and storage is one of several possible environmental technologies to achieve that – and it is identified as a key area for the Norwegian government’s contribution.
 
The environment - Carbon capture and storage
In its Special Report on Carbon Capture and Storage, as well as in the Fourth Assessment Report, the IPCC describes carbon capture and storage as a key technology for CO2 mitigation. The technology is applicable in the industrial, fuel transformation and power generation sectors, with the greatest potential in power generation. Analyses by the IEA have similar conclusions. According to the IEA carbon capture and storage has the potential to reduce CO2-emissions by 20-28 %.

Carbon capture and storage will complement other climate change mitigation actions by providing an option for using fossil fuels, including coal, during the transition to a low carbon economy. It offers the potential to reduce CO2 emissions by between 85 % and 95 % from coal and gas-fired power plants. Carbon capture and storage in combination with biomass use could go even further and contribute to a net removal of CO2 from the atmosphere.

Norway has extensive experience in storing CO2 in geological structures. Currently, there are four large scale carbon capture and storage projects in operation or under development:

Since 1996, one million tons of CO2  per year have been separated from the gas production on the Sleipner Vest field in the North Sea and stored in a geological formation 1,000 meters below the seabed. Multinational research projects have collected relevant data in the formation, and developed and demonstrated prediction methods for the movement of the CO2 for many years into the future. The data show the precise subsurface location of the CO2 plume and confirms that the CO2 is confined securely within the storage reservoir.

In the Snøhvit field in the Barents Sea, 700,000 tons of CO2 will be separated annually from the natural gas and reinjected and stored in a geological formation 2,600 metres under the seabed.

The Norwegian government and the oil company Statoil have agreed to establish a full-scale carbon capture and storage plant in conjunction with a gas-fired power plant on the west coast of Norway. The Norwegian government also intends to provide for a full scale carbon capture and storage solution for a gas-fired power plant at Kårstø in the South-Western part of Norway.

Some believe that carbon catch and storage should not be developed because it – allegedly - prolongs the use of fossil fuels and/or steals attention and funding from renewables. I disagree. We need carbon capture and storage as well as more renewables and focus on energy efficiency.

Energy efficiency
We are all part of the total pattern of consumption.  The beneficial effects of introducing energy efficiency in homes, public and business buildings and in industry is often underestimated. Energy efficiency should be a key factor both in meeting the challenges of energy demand and climate change mitigation.

According to the IEA the global potential for energy saving is massive. For instance if China replaces all air-conditioning and refrigerators with the most energy efficient option it would be saving energy equivalent to the capacity of Three Gorges by 2020. This example illustrates the potential of energy efficiency, but to trigger this we need millions of households to actively make changes. It goes without saying that this is not an easy task. We politicians need to implement policies that promote this change.

Norway an energy nation
Norway is the world's sixth largest hydropower producer, with an installed capacity over 28,000 MW. Our domestic demand for electricity is almost entirely covered by hydropower. This has been very beneficial to our environment as well as security of supply.

For 40 years we have also been an oil and gas producer. Almost all of the gas and most of the oil is exported which makes us the third largest exporter of gas and the fifth largest exporter of oil. Our oil production is now on a decline while gas production will continue to increase.
Norwegian gas is important in the change of fuel in power generation which takes place in Europe – a change from coal and fuel oil to gas.

Hydropower
Hydropower will play an important role in reducing CO2-emissions.  Production electricity from hydropower has an excellent performance when it comes to greenhouse gas emissions.

For many countries, and especially the developing countries, a great concern is how to secure energy supply. A good way to do this is to develop domestic natural resources. Development of hydro power can be essential to improve security of supply and will contribute to less greenhouse gas emissions.
Some say hydropower ruins the natural habitat.  I agree that we should agree on international guidelines to minimize negative effects on the local community.  But I disagree with anyone reducing the relevance and importance of hydropower.

Biofuels
Biofuels could be a part of the solution if we are to cut greenhouse gas emissions. This does not mean that biofuels is the only solution – we must also continue to promote other alternatives to fossil fuels as well as low emission vehicles and more effective transport solutions. And this does not mean that we welcome all biofuels at any cost. Biofuels are no good if they lead to hunger and biodiversity loss – or if their production ends up being carbon intensive i.e. requires hydrocarbon-based energy to produce or involves land-use change that destroys effective carbon sinks. We must demand sustainability at all levels.

We need to create the policy frameworks that promote the efficient and sustainable use of biofuels. We must require strict environmental standards for biofuels, whether the biofuels are produced domestically or imported.
Some oppose biofuels claiming it hurts the poor.  I agree we have to advance to second and third generation biofuels (i.e. non-food) as quickly as possible.  But I disagree with anyone claiming biofuels are not part of the solution.

Windpower
Wind is interesting for Norway by way of having a lot of steady windy locations and by way of our off-shore petroleum competence, which may be applied in some measure to the challenge of making off shore wind relevant and commercially viable.

It is a long way to go. That is why it is urgent to start. We support the development of windpower.

Some people say that wind mills are ugly and/or noisy. We need to agree on guidelines to take the interest of the local community into consideration.  But I am convinced that windpower is compatible with such considerations.

The Arctic as an illustration
Norway has interests at both poles. The historic commercial and adventurous explorers have been replaced by scientific expeditions. As we speak, a US/Norwegian scientific expedition is on its way to the South Pole, and the Prime Minister is today visiting the Troll Research station. 
This picture is from the Arctic. Both poles remind us of the urgency and of the dimensions of the climate change policy.

We have a responsibility.