Norway plans to nationalize gas pipeline network

Norway’s government said it plans to nationalize natural gas pipelines--roughly 5,600 miles--as existing concessions expire.

The Ministry of Petroleum and Energy sent a letter to relevant licensees signaling that the state aims to make use of the right of reversion at the end of the license period and wants a full state ownership of the key parts of the upstream pipeline network. Licensees include Shell, ConocoPhillips and Equinor.

“Large parts of the infrastructure in the Gassled partnership have license periods that expire in 2028, and the state has the right of reversion at the end of the license period,” according to the ministry. “Other parts of the gas transport system have longer license periods. Certain systems do not have an explicit license period.”

Gassled is a joint venture that owns most of the gas infrastructure on and serving the Norwegian continental shelf: pipelines, platforms, onshore processing plants and receiving terminals abroad.

Gas pipelines on the Norwegian continental shelf.

The overall objective of Norway’s petroleum policy is to facilitate profitable production of oil and gas in a long-term perspective. The upstream gas pipeline network, and its regulation, plays a key role in achieving this fundamental objective, the government said..

The main features of the regulation of the gas transport system are expected to be continued also after 2028. It means that Gassco will continue to be the operator of the system and use technical service providers. That tariffs will be cost-based. Investments in new gas infrastructure on the continental shelf will, as currently, continue to be driven by the commercial players and their need for gas transport. With this established practice, a market test is ensured when developing new infrastructure.