23 Licensees Sign Norwegian VOC Cut Agreement

An agreement aimed at helping to achieve sharp cuts in emissions of volatile organic compounds (VOCs) from the Norwegian continental shelf has been signed by 23 licensees today. "This agreement is an important event," says project manager Egil Tveit in Statoil. "Through a unique collaboration, the industry is making a joint effort to cut the release of VOCs dramatically." The partnership will mean that emissions of polluting hydrocarbon vapor will be reduced more quickly over the next few years than if each company took individual action.

In addition, it will lower the cost of the necessary measures through efficient use of VOC recovery plants on the shuttle tankers serving Norwegian offshore fields. Once planned recovery units have been installed on these vessels by the end of 2005, measures to cut VOC emissions are expected to cost USD 0.12-0.25 per barrel of crude. The exact figure will depend on the size of the field and its storage capacity. A total of 15 such facilities are due to be installed, and reducing VOC emissions is expected to cost the industry NOK 1.5-2 billion up to 2010. Two recovery plants have already been installed on shuttle tankers, while a further six are under construction or at the planning stage.

The Norwegian authorities have specified that 40 percent of offshore loading and storage must be conducted by next April with measures which give a VOC emission cut of at least 78 percent.

In all, 70 percent of all oil being loaded off Norway must be subject to emission-reducing measures by the end of 2004, and this proportion has to reach 95 percent at January 1, 2006. This requirement reflects the fact that the petroleum industry accounts for 65 percent of total VOCs released by Norway. International agreements – including the Gothenburg protocol – commit the country to reduce its emissions of these compounds. "We intend to meet the government's targets with a good margin," says Mr. Tveit. "The industry has a collective desire to produce oil and gas without harming the environment. This collaboration represents an important step towards achieving that aim."

An executive committee drawn from Statoil, Shell, Esso and Norsk Hydro will lead the work. Statoil shipping subsidiary Navion has been appointed VOC operator for the partnership, including allocation of costs between the companies involved. The other participants in the collaboration are Petoro, Fortum, TotalFinaElf, Norsk Agip, BP, Dong, Idemitsu, RWE-DEA, ChevronTexaco, Paladin, Gaz de France, Enterprise Oil, DNO, Conoco and Amerada Hess. These companies all have interests in Norwegian fields which are produced by offshore loading of crude into shuttle tankers for shipment to land.

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