Statoil Producing LNG in Snoehvit, Norway

The Norwegian oil company Statoil said Friday from Oslo, Norway that it had set up the largest liquefied natural gas (LNG) project in Europe in the Barents Sea. Statoil said the large-scale gas project also involves French oil group Total and gas utility Gaz de France, who respectively hold 18.4 percent and 12 percent of the project with Statoil holding 33.53 percent.

Located at the northern tip of Norway and linked by pipeline to the gas deposit at Snoehvit, Norway the project produced its first cubic metres of liquefied natural gas on September 13, 2007 after five years of development. It had a cost overrun of 18.8 billion kronor (the equivalent of 2.4 billion euros or 3.3 billion dollars) Statoil said.

Initially fixed at 39.5 billion kronor, the cost of the project ran to 58.3 billion kronor, Statoil said. The other partners are the Norwegian company Petoro (30 percent), US firm Hess (3.26 percent), and Germany's RWE-DEA (2.81 percent).
"The first phase will be characterised by instability," Tim Dodson, Statoil's acting executive vice president for exploration and production Norway said in a statement.
"We must expect that the plant will again be closed for shorter or longer periods for further adjustments to the process."

The gas has been prepped for the American and European markets.