Norway Govt Wins Ruling over Lowered Gas Pipeline Tariffs
OSLO, June 30 (Reuters) - A Norwegian appeals court ruled in favour of the government in a lawsuit brought by investors who argued Norway's cut in gas pipeline tariffs was unlawful and would cost them 15 billion Norwegian crowns ($1.8 billion) in lost earnings through 2028.
The decision upheld the 2015 verdict of a lower court, which said the government acted within its rights when it lowered tariffs on offshore gas pipelines.
"The state has won the case and has the right to have its costs covered (by the plaintiffs)," the Borgarting Court of Appeal said in its verdict.
In the first round, the state won the case but did not win the right to have its costs paid. The latest verdict overturned that decision, awarding the government 42.2 million crowns from the plaintiffs.
The verdict, delivered by three judges, was unanimous.
The lawsuit was brought by Solveig Gas, Silex Gas, Njord Gas Infrastructure and Infragas, which hold a combined 44 percent stake in pipeline joint-venture Gassled.
The firms are owned by Allianz, UBS, the Abu Dhabi Investment Authority and the Canada Pension Plan Investment Board, among other investors.
"We have been acquitted in two instances," the Ministry of Petroleum and Energy said in a statement.
Silex Gas told Reuters ahead of the verdict it would consider an appeal to the Supreme Court if it lost this round, but would also be open to discussing a settlement with the state.
After the verdict, Silex Gas CEO Kurt Georgsen declined to say whether the company would appeal or whether it would sell its stake in Gassled.
"The court has emphasised that the ministry did not establish transparent systems. But the court has also said that there was a legal basis for the tariff reductions and that we have no basis for claims and damages," he said.
Another plaintiff, Solveig Gas, said it would consider "carefully" whether to appeal.
"We will obviously continue as owners in Gassled. We will keep Gassled running. This case never impacted in our role in Gassled," said Solveig Gas CEO Tryve Pedersen.
Another plaintiff, Infragas, declined to comment.
If the plaintiffs do appeal to the Supreme Court, they must do so by September 16.
The government owns 45.8 percent of Gassled via state-owned Petoro, while majority state-owned Statoil has 5 percent.
Some of the companies involved have said the unexpected decision to lower gas transportation tariffs had hurt the image of Norway as a country to invest in.
The government cut tariffs shortly after the four firms bought their stakes in Gassled in 2011 and 2012 from ExxonMobil , Total, Statoil and Royal Dutch Shell for a total of 32 billion Norwegian crowns.
The lowered tariffs took effect on gas transport agreements on October 1, 2016.
The oil ministry said last September the move was in line with its longstanding policy of keeping a pretax return on capital investment in transportation infrastructure at around 7 percent.
"The new tariffs will continue to generate a reasonable profit for Gassled," the ministry said at the time. ($1 = 8.3758 Norwegian crowns) (Reporting by Lefteris Karagiannopoulos; writing by Nerijus Adomaitis and Gwladys Fouche; editing by Jason Neely and David Evans)
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