The Norwegian Gas Plant That Could Safeguard Europe From Trump

STAVANGER, Norway — Europe was supposed to leave gas facilities like Kårstø behind.

Instead, the giant processing plant is at the center of a wider continental shift. Emission reductions are out. Energy security is in.

Wars in Iran and Ukraine have upended Europe’s climate and clean energy plans, leaving the continent scrambling to secure gas still needed to generate electricity, heat homes and power factories.

European gas storage levels are near historic lows as winter approaches, a potentially ominous sign for continental heating and power bills. Many European leaders are wary of leaning too heavily on America lest their energy needs be used against them in trade and security negotiations with President Donald Trump. (The White House, for its part, says the U.S. has an "abundant and reliable supply" for allies.)

“We live in a world where dependencies can and are weaponized,” said Ann Mettler, who worked as adviser to former European Commission President Jean-Claude Juncker. “It's understandable that the Europeans may have second thoughts.”

Which leads back to Kårstø. An industrial warren of pipelines, distillation towers and flare stacks along the Norwegian coast, Kårstø is the largest gas processing facility of its kind in Europe.

Though Norway is outside the European Union — and uses little fossil fuels itself — it supplied nearly a third of the bloc’s gas and 14 percent of its crude oil last year. Roughly a quarter of Norwegian gas production passes through Kårstø, much of which is shipped to Europe via pipelines to Belgium, France and Germany.

Gas production on the Norwegian continental shelf has flagged over the last decade, but Europe’s newfound focus on energy security has sparked new interest in squeezing the remaining hydrocarbons out of its subsea reservoirs. Climate change is lower on the list of Europe’s priorities, with renewables mainly brought up as a way to protect consumers from spikes in fossil fuel prices.

Equinor, which runs Kårstø and is Norway’s top oil and gas producer, embodies the shift underway. Six years ago, when political concerns over climate change reached a peak, Equinor announced a plan to invest in renewable energy and achieve net-zero emissions by midcentury.

This year, it dropped a renewable target, though not its net-zero goal, to focus on the Norwegian continental shelf.

“All my customers in Europe, they have a transition strategy and they're working on investing in renewables. But they're also securing long-term contracts for gas,” Equinor CEO Anders Opedal told POLITICO last week, shortly after signing a 15-year gas supply contract with the German utility Uniper.

'As high production as possible'

The beating heart of Norway’s oil industry can be found in Stavanger, a small port city about an hour’s drive south of Kårstø.

The city is home to Equinor’s headquarters and one of the world’s largest energy conferences. This year, nearly 70,000 people descended on the city for the Offshore Northern Seas Summit, packing a series of airplane hangar-sized conference halls.

Norwegian business and political leaders used the occasion to pitch their country as the fossil fuel supplier Europe can count on — and drum up support for drilling on the continental shelf.

When Equinor announced its deal with Uniper on the conference’s opening day, Opedal said it would “contribute to energy security for Europe and, through this contract, Uniper will contribute to demand security, allowing us to continue investing in developing the Norwegian continental shelf.”

The message was echoed by Norwegian officials. The government owns a two-thirds stake in Equinor, while its remaining shares are publicly traded.

“Our strategy is to be a long-term provider of oil and gas to the European market,” said Norwegian Energy Minister Terje Aasland. “Our target is not in numbers, but it's to have as high production as possible.”

That could be a tall order. It’s unclear how long Norway’s oil and gas reserves will hold out.

Norwegian oil and gas production is expected to fall a third by 2050. And that’s in a best-case scenario, according to Torgeir Stordal, who leads the Norwegian Offshore Directorate, the government agency responsible for regulating the continental shelf. The directorate’s baseline scenario assumes production will fall by more than half.

Industry executives and political leaders in Oslo say more investment is needed to stave off production declines. They are also hoping technology can help “flatten the curve” — industry jargon for thwarting production declines.

On ready display among the hundreds of stalls at ONS were the tools of extraction: frontier-pushing drones, aquatic robots, AI mapping systems, pumps, drills and power generators, decked out in bright polymers and gleaming steel.

Any serious hope of slowing the production decline will come from new discoveries on the frontier, particularly in the Barents Sea in Norway’s far north. That will require an increased appetite for risk, enormous expenditure — and attracting young Norwegians to far-flung regions of the country.

The mayor of a small Norwegian Arctic community was on hand at ONS to promote his plan to build a university to attract young people to his community. Hammerfest Mayor Terje Rogde brought with him Jon-Andre Kongsbak, a 31-year-old Hammerfest native with pale eyes and silver-blond hair, who recently returned to his hometown after attending college a 30-hour drive away.

With better higher education locally, “you don’t have to do like this guy [did],” Rogde said.

Oil politics

Norway has ample incentive to forge ahead. Oil and gas revenues have helped the country build the world’s largest sovereign wealth fund, which is currently valued north of $2 trillion. Its annual distributions amount to roughly a fifth of the federal budget.

In Stavanger, signs big and small speak to oil’s importance to the city. The local professional ice hockey team is known as the Oilers. A museum celebrates the history of the local oil industry. Advertisements for Equinor adorn bus stops.

Each evening during ONS, thousands of buttoned-up attendees descended on the city’s harbor to sip champagne aboard motor yachts and vintage wooden sailboats or mingle in industry-sponsored tents along the water's edge.

At Equinor’s tent one evening, young Norwegians dressed in collared shirts and puffy vests munched on braised ox with mashed potatoes and stuffed rice balls as they listened to industry veterans discuss career prospects in the oil industry.

But it’s unclear whether this sectorwide mobilization will be enough to stave off production decline. At ONS, some industry executives said the country is not acting with enough urgency to stem those declines.

During one panel, a sneaker-clad Johnny Hersvik, the CEO of Aker, another major Norwegian fossil fuel company, openly lobbied Aasland to make it easier for companies to experiment with tech that he said could drastically speed up production. The minister, shifting in his seat, promised only to listen.

"I don't think there's a sense of urgency, no," Hersvik told POLITICO.

Not every Norwegian is enamored with the country’s all-dominating energy sector. On the first day of ONS, members of the climate group Extinction Rebellion drank oil in protest outside the main conference hall.

The country’s Green Party also made history last year when it joined the government as part of a multiparty coalition led by the Labour Party, a staunch backer of the energy sector. While small, the party has pushed for Norway to imagine a future without oil, forcing the government to set up a commission to explore scenarios for a fossil-free future.

But it’s been a struggle to achieve much else, acknowledged Green Party Member of Parliament Frøya Skjold Sjursæther, as she gestured at the gaudy event space surrounding her at ONS, where oil majors like Shell and TotalEnergies erected booths the size of small office buildings.

“You can just see here when you're walking around the center how much of a grip the oil gas producers have over Norwegian politicians, and [that] they can pretty much dictate the politics we're having here,” she said. “That’s really sad.”

Energy contradictions

One of Norway's ironies is that it consumes relatively little of the fuel it produces. It has the highest rate of electric vehicle ownership in the world, and about 90 percent of its electricity is generated by hydropower.

Norwegian business and government leaders have carefully calibrated their message to appeal to the European Union, for which climate remains a priority, without offending the United States, with which Norway has maintained relatively warm relations under Trump.

“U.S. LNG is important for Europe to have energy security,” said Aasland, the energy minister, when asked if the Nordic country is competing in Europe with American LNG.

A White House spokesperson agreed, adding that Trump has been urging Europe to "ditch the Green New Scam" for years.

“Thanks to President Trump’s energy dominance agenda, the United States is the world’s largest producer and exporter of oil and natural gas.," White House spokesperson Taylor Rogers said in a statement to POLITICO. "We have an abundant and reliable supply for both our country and our allies.”

Equinor executives were similarly quick to note that the country is heavily invested in the U.S. oil and gas sector, even as they highlighted the company’s efforts to develop offshore wind for the European market.

“We have a clear strategy to provide reliable energy in a world in transition,” Opedal said. “Meaning focusing on developing energy, either offshore wind or oil and gas, and the majority will continue to be oil and gas.”

Norway has learned to discern the difference between what Europe says it wants, and what it actually does, said Mettler, the former Juncker aide who now serves as the CEO of the think tank Catalyse Europe. Oil and gas continue to account for more than half the continent’s final energy consumption, despite its attempts to boost renewables, electric vehicles and heat pumps.

“We say one thing, we moralize in public and we say we want to do these things, but then what we're actually doing is buying a lot of LNG,” Mettler said. “We haven't delivered enough of a business case for clean energy in many instances. So that's why a lot of the European oil and gas companies are sort of returning to their roots.”

The contradictions were visible at Kårstø. A clutch of wind turbines towered over the facility on a nearby hillside. Workers in high visibility green vests biked between jobs at the plant. A pair of deer and a herd of cattle grazed in the rolling green hayfields bumping up against the facility, which is set against the backdrop of Norway’s mountainous coast.

At the plant, two bright orange flames sent a plume of black smoke into the air, as excess gas was burned off in preparation for an upcoming maintenance job. The practice is needed to ensure the safety of maintenance workers, but it is also seen as hugely wasteful and a major contributor to rising global temperatures — tellingly, the EU itself is trying to lead efforts to stomp it out.

It was one more reminder that however much Europe tries to transition to its long-dreamed fossil-free future, carbon-choked pollutants will continue to darken the continent’s skies — right until the wells run dry.