This article was published by the US Energy Information Administration on Nov. 1, 2022.
By Kimberly Peterson
Norway is among the top 10 natural gas-producing nations in the world and has always been an important source of natural gas to the European Union (EU). Russia’s full-scale invasion of Ukraine at the end of February 2022 resulted in significant declines in natural gas imports to the EU, particularly starting in June 2022, increasing Norway’s importance as a source of natural gas to the region.
Note: Russia by pipeline includes the Nord Stream and Yamal pipelines and pipelines entering Europe at Velke Kapusany. Natural gas flows from Norway represent daily exit nominations on pipeline infrastructure going from the Norwegian Continental Shelf to receipt terminals in Belgium, France, the United Kingdom, and Germany.
Norway is not a member of the EU, but it is an important trade partner and a member of the European Economic Area. According to our updated Country Analysis Brief: Norway, in March 2022, the Norwegian government authorized an increase of approximately 0.14 billion cubic feet per day (Bcf/d) of natural gas production by the end of 2022, primarily from two existing fields. In 2021, Norway produced 11.1 Bcf/d of natural gas.
In 1990, Norway exported nearly all (92 per cent) of the 2.7 Bcf/d it produced. In the 40 years since then, that ratio has remained fairly stable: Norway exports 94 per cent of its annual production, on average. In 2021, Norway was the third-largest exporter of natural gas in the world after Russia and the United States.
Most of Norway’s natural gas exports are shipped via the country’s extensive export pipeline infrastructure, with smaller volumes exported as liquefied natural gas (LNG). In June 2022, Norway reopened its Hammerfest LNG facility, which could allow for an increase in natural gas exports by about 0.7 Bcf/d in 2022. Hammerfest processes natural gas from the nearby Snøhvit field in the Barents Sea. In 2019, the last year the liquefaction facility was fully operational, 5 per cent of Norway’s natural gas exports were shipped as LNG.
In 2021, Norway invested nearly 4 per cent, or $18 billion, of its gross domestic product in crude oil and natural gas extraction and pipeline transportation.