| Details: | UK Energy Minister Stephen Timms and his Norwegian counterpart Einar Steensnaes today praised the oil and gas industry in both countries for increasing co-operation across the international boundary to secure maximum economic benefit from North Sea oil and gas reserves.
Mr Timms and Mr Steensnaes were launching "Unlocking Value through Strengthening Relationships", the second report published by the joint government -industry UK Norway Workgroup, at a meeting in London attended by senior industry figures and government officials from the two countries.
The new report summarises the progress made since the workgroup's first report was published in 2002. This identified a potential prize of up to $2billion that could be achieved through joint working in adjacent North Sea territories in areas such as new field development, redevelopment of existing fields, operational synergies and decommissioning. Since then a number of international working parties have been set up under the UK Norway Workgroup banner to implement and monitor the report's 14 key recommendations.
Mr Timms said:
"Only by working together will we reach our goal and unlock that $2 billion prize".
"We have made huge strides forward this year in terms of consolidating and strengthening co-operation between our two countries, clearly demonstrated by our agreement on the key principles for a framework treaty that paves the way for the groundbreaking Britpipe project. I'm sure our continued efforts will reap rewards in the near and the longer term future".
"This strengthening of relationships, together with a joint commitment from both governments to an open and transparent market on trade issues, will benefit hugely the supply chain in both Norway and the UK".
Einar Steensnaes, Minister of Petroleum and Energy, Norway, said:
"As neighbours, the UK and Norway share a common interest in ensuring good management and commercial development of our respective petroleum resources.
"I am very pleased with the work the industry has put in together with the authorities in contributing to a fruitful cooperation across our common boundary. The report published today is a tangible illustration of the potential in our efforts to remove barriers to cross-boundary initiatives. The process we have been through is also very promising for the important work that lies immediately before us. That is, the completion of the framework treaty and the development of the new pipeline from Norway to the UK."
The framework treaty, one of the UK Norway Workgroup's14 recommendations, will constitute the most comprehensive energy co-operation agreement yet between UK and Norway and underpin future cross-border commercial projects.
Other main areas of progress outlined in the 2003 report are:
Guidelines:
The drafting of guidelines to the existing 1998 Framework Agreement which covers offshore cross-boundary interconnecting pipelines. The guidelines will set out in practice how the articles of the Agreement would apply. Similar guidelines will be prepared for the new Framework Treaty;
Safety:
Representatives from the UK's pan-industry "Step Change for Safety" campaign and its Norwegian equivalent "Working Together for Safety" have met regularly to discuss best practice, share expertise and resources, and co-operate in planning;
Regulation, Gas and Infrastructure:
Discussions have been held to ensure there is sufficient capacity in the UK National Transmission System (NTS) at predictable prices to handle projected volumes of Norwegian gas imports. Talks have also taken place to ensure compatibility of UK, Norwegian and continental gas sales specifications. In April 2003 the UK government announced it would exempt new tariff income on existing UK infrastructure from Petroleum Revenue Tax (PRT), from January 2004. This will deliver the fiscal level playing field for new tariff business sought by the industry and addressed in last year's report.
Mutual Open Market Access:
Work to improve mutual access to the UK and Norwegian markets has included UK-Norway "Share Fairs" held in both countries; the publication of supply chain guidelines for doing business in the UK and Norway; the development of a single pre-qualification tender system for cross-border bidding and an integrated business directory of suppliers for launch in 2004; and a Business-to-Business Mentoring scheme. |
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