According to OGJ, Norway had 84.3 trillion cubic feet (Tcf) of proven natural gas reserves as of January 2006. The North Sea holds the majority of these reserves, but there are also significant quantities in the Norwegian and Barents Seas. Norway is the eighth-largest natural gas producer in the world, producing 2.95 Tcf in 2004. However, because of the countrys low domestic consumption, which totaled only 290 billion cubic feet (Bcf) in 2004, Norway was the worlds third-largest net exporter of natural gas in 2004, behind Russia and Canada. As is the case with the oil sector, Statoil and Norsk Hydro dominate natural gas production in Norway. Several international majors, such as ExxonMobil and BP, also have a sizable presence in the NCS gas sector, though they often work in partnership with Statoil or Norsk Hydro. Norway has begun to slowly reform the midstream and downstream gas sectors. In June 2001, the Norwegian government eliminated controls on natural gas prices. Also in 2001, the government created Gassco, a state-owned company responsible for administering the natural gas pipeline network. Previously, Statoil and Norsk Hydro had controlled the network; it is hoped that placing control of the system with an independent company will ensure fair, indiscriminate access for all companies. The company also manages Gassled, the network of pipelines and receiving terminals that exports Norways natural gas production to the United Kingdom and continental Europe.
A small group of fields account for the bulk of Norways total natural gas production. The single largest field is Troll, which produced 3.11 Bcf per day (Bcf/d) during the first half of 2006 and represents about one-third of Norways total natural gas production. Other important fields include Sleipner Ost (1.45 Bcf/d), Asgard (1.00 Bcf/d), and Oseberg (0.72 Bcf/d). These four fields compose over 70 percent of Norways total natural gas production. Despite the maturation of its major natural gas fields in the North Sea, Norway has been able to sustain annual increases in total natural gas production by incorporating new fields. In October 2004, the Kvitebjorn field came onstream with an expected production level of 710 million cubic feet per day (Mmcf/d). In November 2005, Statoil brought the Halten Bank West project onstream, which includes the Kristin field and four additional satellite fields (Lavrans, Erlend, Morvin, and Ragnfrid). Over the long term, Norway is counting on non-North Sea projects to provide significant natural gas production. In the Norwegian Sea, Norsk Hydro is currently developing the Ormen Lange field. The project consists of an offshore production facility and a subsea pipeline linking the field to the gas processing terminal in Nyhamma. In addition, the Ormen Lange project includes a pipeline linking Nyhamma to Easington, England (see below). Ormen Lange holds an estimated 14 Tcf of recoverable reserve and will have a full production capacity of 710 Bcf per year. Shell will take over as operator of the project from Norsk Hydro in the production phase, which is scheduled to begin in late 2007. Also in the Norwegian Sea, Shell announced in 2005 that it had made a major discovery in the Onyx prospect, west of the companys existing Draugen field. According to the Norwegian Petroleum Directorate (NPD), the find could contain as much as 2.1 Tcf of recoverable gas reserves. In 2005, Norsk Hydro reported that it made a discovery at its Stetind project in the Norwegian Sea, containing estimated natural gas reserves of 0.5-1.3 Tcf.
In the Barents Sea, Statoil is developing the Snohvit project, which contains an estimated 5.7 Tcf of proven natural gas reserves. Snohvit will combine production from three gas fields (Snohvit, Albatross, and Askeladd), a pipeline connecting these fields to an onshore receiving terminal near Hammerfest, and a liquefied natural gas (LNG) export terminal (see below). According to Statoil, first production from the Snohvit field should occur in June 2007, with production from the other two fields beginning in over the following 5-10 years. Norway has worked with Russia to jointly develop the giant Shtokman natural gas field and pursue other oil and gas projects in the area. One issue that has stalled the development of natural gas reserves in the area has been the lack of a defined maritime boundary between the two countries. The area of dispute between the two countries contains oil and natural gas reserves estimated at 12 billion barrels of oil equivalent.