Climate Change in Election Spotlight in Oil Giant Norway

Norwegian Elections Highlight Climate Change Concerns in Oil Sector

By Nerijus Adomaitis

STAVANGER, Norway (Reuters) – Climate change has surfaced as a key issue for Norwegian voters in a Sept. 12-13 parliamentary election, and none more so than in the country’s oil industry capital, Stavanger, which is preparing for a low-carbon future.

Norway emitted about 13.3 million tonnes of carbon dioxide equivalent in 2020 from fossil fuel production, but emissions from its oil and gas used abroad were 30 times higher at more than 400 million tonnes, said Robbie Andrew, a senior researcher at Oslo-based climate think-tank CICERO.

Western Europe’s top petroleum producer is facing pressure from environmental groups to stop all new oil and gas projects to help keep climate change in check.

The opposition Labour party and its allies including the Socialist Left are widely expected to replace the ruling coalition of Conservative Prime Minister Erna Solberg, polls indicate. Labour supports continued petroleum exploration while the Socialist Left opposes it.

Since the publication of a United Nations report https://www.reuters.com/business/environment/un-sounds-clarion-call-over-irreversible-climate-impacts-by-humans-2021-08-09 on Aug. 9 warning that global warming was dangerously close to spiralling out of control, parties that prioritise climate change, such as the Green Party and the Socialist Left, have seen their popularity rise in polls. The Greens saw a 25% rise in their party’s membership.

The better the pro-environmental parties perform in the election, the more likely they will be able to force through curbs on oil companies, such as limiting where they can look for new fields.

Still, it will be a tall order to call time — as the Greens want — on a sector that accounts for 42% of national exports and employs around 160,000 people.

Graphic: Left-wing vs right-wing support in Norway parliament – https://graphics.reuters.com/NORWAY-ELECTION/dwpkrrqwlvm/chart.png

ENERGY TRANSITION

Nowhere is the focus on climate change policies as high as in Stavanger, a windswept west coast city set among fjords that is home to Equinor and other oil firms.

Here it’s no longer business as usual.

“There has been a massive acceptance that we need to change, that we need to start planning for life after oil,” said Svein Kvernstuen, 49, the chief executive of Beyonder. The company makes fast-charging battery cells produced with renewable energy and sawdust that can be used to power heavy machinery or to stabilise power grids.

Like his father, Kvernstuen once worked on offshore platforms, and later worked at an oil services company, before founding Beyonder in 2016.

He wants any new government to focus on education to ensure he can employ the skilled workers for the pilot plant he is building for 700 million crowns ($79 million), with plans to start full-scale battery cell production in 2024.

Getting workers with the right skills was a big challenge, he said, and the company had to recruit some people from abroad, mainly from Asia.

NorSea, an operator of supply ports to offshore oil and gas platforms, is looking to develop the world’s largest site to construct foundations for floating offshore wind turbines. Norway has opened offshore areas to wind farms and plans to have the first tenders next year.

Chief Executive John Stangeland wants simpler bureaucratic procedures, saying current regulations could take up to a decade to see the first floating wind turbines spinning on the Norwegian continental shelf.

“My fear is that we are moving too slow,” the 57-year old said.

END OF THE OIL AGE?

The Green Party, which wants to end oil exploration immediately and production by 2035, expects to achieve its best-ever election result, thanks to young and urban voters – reflecting a trend seen elsewhere in Europe, such as Germany.

“We believe we will get eight to ten representatives in parliament, compared to one now,” said Ulrikke Torgersen, 24, the Greens’ candidate in Rogaland, Stavanger’s region. Norway’s parliament has 169 seats.

The top two parties, Labour and the Conservatives, want to use the industry’s knowledge to create green jobs and negotiate the energy transition without leaving people behind.

Labour has ruled out any alliance with the Greens, who say they will only support a government that ends oil exploration immediately and production by 2035. That stance may be tested after the elections if Labour cannot form a majority without the Greens.

“The most important thing we have to do for the people who work in the oil and gas industry is to increase the speed of creating more renewable energy industries, so they have jobs to go to,” said Hadia Tajik, Labour’s deputy leader and a parliamentary candidate for Rogaland.

Labour backed the Conservative government’s white paper on energy presented in June, which bet on hydrogen and offshore wind for Norway’s energy transition while letting oil and gas firms continue extraction until 2050 and beyond.

“We want the oil and gas industry to know that there will be no surprising political changes with Labour, and that the changes will be discussed with the sector itself,” said Tajik.

That is welcomed by oil workers, who fear the Greens could push the new government to adopt policies that would restrict oil activities but do little to reduce global production and would benefit other oil producers such as Russia and Saudi Arabia.

“Our biggest concern is that the Greens could have their fantasies come through,” said Kai Morten Anda, deputy leader of Safe, one of the unions representing oil workers.

Meanwhile, the industry continues to pump the petroleum out, with oil firms planning to approve about 50 new projects during 2021 and 2022, the Norwegian oil regulator said, amounting to some $43 billion in investments.

That is in contrast with what other Nordic states are doing. Denmark, for instance, is trying to forge an international alliance of countries willing to fix a date to phase out petroleum production.

Graphic: Norway petroleum production 1971-2025 – https://graphics.reuters.com/NORWAY-OIL/zgpommjbwpd/chart.png

“Oil is a dying business. In the last couple of years we had rough ups and downs, lots of people were laid off. It’s not appealing to me,” said Kim Erling Stangeland (no relation to John Stangeland), 24, who studied economics, and now works part-time as a shop assistant.

($1 = 8.8156 Norwegian crowns)

(Editing by Gwladys Fouche and Emelia Sithole-Matarise)