UK & Norway Sign Pipeline Agreement

The Ormen Lange License participants are satisfied that an agreement on the treaty principles for the cross-boarder pipeline has been reached.

The British and Norwegian energy ministers have agreed the treaty principles that will enable transport of gas from the Ormen Lange field offshore Norway to the British market. This agreement is an important step forward to meet the project schedule. This is based on delivery of third party gas through the southern leg from the Sleipner Riser Platform to Easington in the UK by October 2006. Deliveries of gas from Ormen Lange will start through the northern leg from Nyhamna to the Sleipner Riser Platform from October 2007.

"We are very pleased that we have had this clarification about the treaty principles. This enables us to continue the work on the Ormen Lange project according to the planned schedule," says director Bengt Lie Hansen, chairman of the Ormen Lange unit management committee.

The Ormen Lange Plan for Development and Operation (PDO) and the pipeline Plan for Installation and Operation (PIO) will be submitted to the Norwegian authorities during the fourth quarter 2003, and the Pipeline Works Authorization (PWA) submitted to the UK authorities early 2004.

The Ormen Lange field is the largest gas field under development on the Norwegian continental shelf. The planned volumes to be exported to the UK amounts to approximately 20 billion Sm3/year over a 20-year period. The total length of the pipeline from Nyhamna in Norway to Easington in UK is 1200 km.

The Ormen Lange field is located 100 kilometers off the Norwegian northwest coast at a water depth of some 1000 meters.

Participants in the Ormen Lange license are: Norsk Hydro as operator for the development and construction phase with 17.956%; Shell as operator for the production phase with 17.200%; Petoro with 36%; BP with 10.888%; Statoil with 10.774% and ExxonMobil with the remaining 7.182%.