Norway will continue to develop its oil and gas resources in the Barents Sea regardless of the European Union's support for a moratorium on hydrocarbon extraction in the Arctic, Energy Minister Thierry Ausland said, quoted by Reuters. The Scandinavian country already sees itself as Europe's "green battery", he added, BTA reported.
After Russia's invasion of Ukraine in 2022, Norway has become Europe's largest supplier of natural gas. The country provides about 30 percent of gas consumption in both the European Union and Britain.
Last year, the country's gas production was close to record levels, and oil production reached its highest level since 2009. However, official forecasts indicate that production will fall sharply after 2030 if new fields are not discovered and developed.
“In today's geopolitical environment and given the resource situation, I believe that continuing activities in the Barents Sea is in the interest of both Norway and Europe,“ said Ausland before the start of Norway's ONS energy conference.
The European Union supports a ban on new drilling in the Arctic on environmental grounds, but is considering changing its policy due to concerns related to energy security.
Anders Oppedal, CEO of “Equinor” (Equinor), Norway's largest oil company, has said that oil and liquefied natural gas (LNG) from the Barents Sea could be shipped anywhere in the world if the EU refuses to buy them.
„The only thing that will actually suffer from this is European security. We have the flexibility,” said Oppedal.
Ausland said Norway aims to maintain oil and gas production and exports at roughly current levels until at least 2035, for which production from the Barents Sea will be key.
“If Norway is to remain a long-term supplier of oil and gas to Europe, then the Arctic must be part of that conversation,” the energy minister said.
In talks with EU officials, Norway has argued that the areas of the Barents Sea open to oil and gas production are also ice-free, like the North Sea, and are therefore less susceptible to oil spills and other environmental impacts. According to Ausland, the extraction also helps to preserve jobs and settlements in the northern regions of the country, which border Russia.
Norway has the sovereign right to develop the resources of the Barents Sea, even if the EU continues to support the moratorium, he pointed out.
“We will develop these areas, and then the EU will decide whether to impose a moratorium on purchases of this gas or oil“, Ausland said.
According to him, Arctic oil will be sold on world markets regardless, while gas can be exported around the world as liquefied natural gas from the “Equinor” plant in Melköya near Hammerfest.
The Director General of the International Energy Agency, Fatih Birol, also called on the EU to reconsider its opposition to new oil and gas projects in the Arctic. He says future supplies are necessary to ensure the bloc's energy security.
However, opponents of such a change point out that putting new Arctic projects into operation will take many years and will not contribute significantly to solving Europe's short-term energy problems.
In addition to oil and gas, Norway also produces a surplus of renewable energy thanks to an extensive network of reservoirs and water resources that power hydroelectric power plants. The country exports this energy to Europe via cross-border power lines.
In the past, Norway presented itself as the “green battery” of Europe, but according to the minister, this concept is now outdated, as Norway alone cannot balance the European electricity market.
This concept has contributed to the construction of new interconnections, including connections with the UK and Germany, but has caused some resistance in Norway against the background of rising electricity prices in Europe.
The closer integration with the European electricity system has made Norway more vulnerable to price fluctuations on the continent.
Ausland said that Norway will not build new interconnections, but remains committed to strong cooperation with Europe in the electricity sector.
He called on European countries to strengthen their stable electricity supplies, weakened by the closure of coal and nuclear power plants and by insufficient investment in new gas-fired plants.
This would lead to lower prices and create greater reciprocity in cross-border electricity flows, he said.
“The future is about having a very strong and integrated system,” said Ausland.