If Norway stopped producing oil and gas, this would jeopardize the European energy transition, the country's new prime minister, Jonas Gahr Store, told the Financial Times in his first interview after taking office.
"If we were to say from one day to the other that we close down production from the Norwegian shelf, I believe that would put a stop to an industrial transition that is needed to succeed in the momentum towards net zero . . . So we are about to develop and transit, not close down," Gahr Store said.
Gahr Store's Labour Party won the elections in Norway last month, beating the outgoing Conservatives, but it failed to secure a majority in Parliament and had to form a coalition with the Centre Party.
Gahr Stoere said ahead of the elections in September: "I believe that calling time on our oil and gas industry is the wrong industrial policy and the wrong climate policy."
Norway will continue to grant permits for oil and gas exploration on the Norwegian shelf and will keep the current system of oil auctions, the incoming government says. Over the next four years-during the term in office of the government-most of the exploration activity will take place in mature areas of the shelf.
Norway is Western Europe's largest oil and gas producer and the second-largest gas supplier to Europe after Russia. This makes the country's fossil fuel output essential for Europe's diversification efforts.
At the same time, however, Norway is also a front-runner in the green transition race, investing heavily in electric cars, wind power, and energy storage. It also enjoys abundant hydropower resources, which are a key reason for its much greener energy status than most European countries.
Norway has pledged to become a net-zero economy by 2050 and to cut oil and gas production-related emissions by 50 percent by 2030.
By Irina Slav for Oilprice.com
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Irina is a writer for Oilprice.com with over a decade of experience writing on the oil and gas industry. More