GASSCOENGLISH Gas Pipeline at Kårstø

GASSCOENGLISH Gas pipeline at Kårstø. Contents

Accepting responsibility, delivering as agreed page 4

Motorways for Norwegian gas page 6

Gas administrator page 11

Kårstø’s key role page 13

Kollsnes page 15

Value chain for gas page 16

Receiving terminals in Europe page 18

Riser platforms – key hubs page 25

Skanled – eastward bound page 26

Facts about gas page 28

The Gassled joint venture page 30

Facts about Gassco page 30

Produced: June 2007 Design: Steinar Iversen Reklamebyrå Photos: Øyvind Sætre, Henderyckx, Hans-Peter Heikens, Eirik Dankel Text: Ragnar Åsland English translation: Rolf E Gooderham Printer: HBO

Accepting responsibility, delivering as agreed

We at Gassco take responsibility for transporting gas safely and efficiently from the Norwegian continental shelf (NCS). Our aim is to be a leading gas transporter in Europe. We will ensure reliable deliveries 24 hours a day, 365 days of the year, with the aid of our control room in Karmøy local authority north of Stavanger.

European demand for Norwegian gas is steadily rising. Norway ranks as the world’s third largest exporter of pipeline gas, and currently supplies more than 15 per cent of all natural gas consumed in OECD Europe. This proportion is likely to increase over the next few years.

Norway’s ability to deliver gas is significant for the daily lives of millions of people. Its reputation as a reliable supplier would be threatened if these deliveries failed to arrive.

Even minor shutdowns on the NCS affect a Europe increasingly dependent on gas imports. So high regularity is essential for maintaining the position of Norwegian gas in a growth market. Ensuring that the companies which export this commodity and their European customers view the transport system as reliable is commercially critical for us at Gassco. That puts reliability at the core of our business. Our offices at Bygnes.

Transport network. Capacity in the integrated transport system, which comprises pipelines, processing facilities, platforms and receiving terminals in continental Europe and the UK, has increased in recent years. It will be up to 350 million standard cubic metres (scm) of gas per day by 31 December 2007. The latest delivery record was set on 11 December 2006, when more than 300 million scm of gas was produced and delivered from the NCS in the course of a single day.

Operatives in Dornum.

Health, safety and the environment. Our goal at Able people at every stage. Despite constant Gassco is zero harm to people, the environment technological advances, our personnel and the or material assets. This zero objective reflects a expertise they possess are the primary reason conviction that all harm can be prevented by we can claim to be reliable. We are accordingly systematic and purposeful work. We have committed to having able people at every established performance indicators which show stage. It is gratifying that we can recruit new the development in our HSE results over time. The employees who help to take our company for- trend in recent years has been positive for the ward. We have a stable and well-qualified staff, activities we operate, with fewer critical incidents and regard ourselves as a change-oriented organ- or personal injuries. isation in which everyone contributes to maintaining and developing the transport system. In this way, we can safeguard Norway’s leading role as a gas supplier.

Zones and tariffs The integrated system for Norwegian gas transport is divided into areas, each with fixed unit prices for transport and/or processing.

Gassled area A: covers the pipeline carrying rich gas from the Tampen area of the North Sea to the Kårstø processing plant. Gassled area B: covers the pipeline carrying rich gas from the Halten Bank in the Norwegian Sea to Kårstø. Gassled area C: covers the Kårstø plant. Gassled area D: covers a number of pipelines, platforms and receiving terminals for transporting dry gas from Kollsnes and Kårstø, or directly from fields, to receiving terminals in the UK, France, Belgium and Germany. Gassled area E: covers the Kollsnes processing plant.

NORWAY SWEDEN

DENMARK

GREAT BRITAIN

THE NETHERLANDS

GERMANY

FRANCE BELGIUM

Motorways for Norwegian gas

We operate a unique system for gas transport through an extensive network of pipelines which total 7 800 kilometres in length, as well as major industrial facilities, platforms and receiving terminals in continental Europe and the UK.

PIPELINE FROM TO LENGTH DIAMETER CAPACITY (scm/d) Haltenpipe Heidrun Tjeldbergodden 250 km 16-inch 7.0 mill Norne Gas Transport (NGTS) Norne Heidrun 126 km 16-inch 10.0 mill Åsgard Transport Åsgard Kårstø 707 km 42-inch 70.4 mill Statpipe rich gas Statfjord Kårstø 308 km 30-inch 26.7 mill Statpipe Kårstø Draupner S 228 km 28-inch 21.1 mill Statpipe Draupner S Ekofisk 203 km 36-inch 44.4 mill Statpipe Heimdal Draupner S 155 km 36-inch 30.7 mill Zeepipe Sleipner Zeebrugge 814 km 40-inch 41.9 mill Zeepipe Sleipner Draupner S 30 km 30-inch 50.0 mill Zeepipe IIA Kollsnes Sleipner 303 km 40-inch 72.0 mill Zeepipe IIB Kollsnes Draupner E 304 km 40-inch 71.0 mill Europipe Draupner E Dornum/Emden 660 km 40-inch 45.4 mill Europipe II Kårstø Dornum 650 km 42-inch 64.8 mill Franpipe Draupner E Dunkerque 840 km 42-inch 53.7 mill Norpipe Ekofisk Emden 440 km 36-inch 44.4 mill Vesterled Heimdal St Fergus 350 km 32-inch 36.0 mill Oseberg Gas Transport (OGT) Oseberg Heimdal 109 km 36-inch 41.9 mill Langeled (from 1 Oct 2006) Nyhamna Easington 1 200 km 42/44-inch 69.4 mill Tampen Link (from 1 Oct 2007) Statfjord Flags 23 km 32-inch 25.0 mill

LAND-BASED RISER Installations also delivering natural gas to the FACILITIES PLATFORMS transport network Kårstø gas processing complex, Norway Draupner S/E At Åsgard: Mikkel Kollsnes gas processing complex, Norway Sleipner Riser At Norne: Urd Emden receiving terminal, Germany Heimdal Riser At Statfjord: Statfjord East, Statfjord North, Snorre and Vigdis Dornum receiving terminal, Germany At Gullfaks: Tordis and Topas Dunkerque receiving terminal, France At Heimdal: Vale and Skirne St Fergus receiving terminal, UK At Jotun: Balder and Ringhorne Zeebrugge receiving terminal, Belgium At Sleipner: Sleipner East and West

Motorways for Norwegian gas cont

The work done around the clock in our control room at Bygnes north of Stavanger is highly significant for our role as operator. One key job is to ensure that customers receive the correct volumes. Other important tasks include ensuring that the products we send on have the proper calorific value and the right content of water, carbon dioxide and hydrogen sulphide.

In addition, our control room operatives coordinate the whole The control room is responsible for optimum operation of the daily flow of information on deliveries to the gas owners and the transport system and for achieving 100 per cent regularity. We call fields responsible for delivery. this “system operation”.

Operatives in the control room at Bygnes. The receiving terminal in Dornum.

One of our roles can be compared in a way with controlling traffic in international air space. Traffic between the pipelines is also considerable, and one of our key jobs is to administer the capacity available in the transport system at any given time.

A certain number of booking rounds are held every year to allocate capacity. Our job is to accomplish this in an objective, non-discriminatory and transparent way which benefits all gas shippers, and which contributes to the most efficient possible utilisation of resources on the NCS.

10 Gas administration

System operation and capacity management. The 23 staff in our control room average 10 years of experience. Controlling the gas flow continues without a break around the clock. Three people work the night shift, while the day and afternoon shifts each have four operatives. Their main duties are to manage the gas flow through constant monitoring, regulate quality and ensure that the gas blend is correct. Since the various fields deliver different gas grades, these must be processed or mixed to achieve the desired quality before delivery to the buyer. Such blending allows us to deliver gas with the agreed composition virtually all the time.

Our control room’s coordinatory role is exten- manner is an important and responsible job. The sive and multifaceted. In certain circumstances, value chain comprises five stages: production, we can instruct a field operator to deliver gas transport to land, processing, onward transport, for a limited period. This happens, for instance, and sales/marketing. if a field shuts down for maintenance or other reasons. We can then require another field to Production. Gas is produced from more than 30 deliver more and others to supply less. The fixed and floating installations on the NCS. control room is also involved in planning short- term shutdowns which supplement major Transport to land. Gas is piped from the NCS to scheduled turnarounds. Transport capacity de- processing facilities on land. At this stage, it is pends to some extent on the ambient water usually a blend of dry gas (methane) and natural The Bygnes control room. temperature along the pipelines, which means gas liquids (NGL – ethane, propane and butanes) that more can be sold in the cold season. Using known as rich gas. good temperature information, updated daily, and advanced computer models, we calculate the Processing. When rich gas reaches the processing daily extra capacity available for sale in the winter. plant, its pressure is reduced before the lightest Planning ship calls at Kårstø also requires careful (dry) gas and the NGL are separated in an extrac- coordination with daily gas flows. tion plant. The various NGL fractions are also separated into ethane, propane and butanes. This is Construction and development. A key challenge accomplished by heating the mix at the base of a for us as operator is to run all our facilities safely tall column, so that the lightest fraction vaporises and cost-efficiently. We are also required to make and collects at the top. The residue is then sent to improvements, remove operational bottlenecks the next column and reheated. This fractionation and increase accessibility in the gas transport process continues until all the NGLs have been system. Ensuring that all Norwegian gas reaches separated out. the market in an acceptable, safe and efficient

11 At Kårstø, NGL is separated from rich gas and then split (fractionated) into propane, normal butane, isobutane, naphtha and ethane. The propane is stored in two large artificial rock caverns, which haVE a combined capacity of 140 000 tonnes. Normal butane, isobutane, naphtha and ethane are held in tanks.

Kårstø ranks as the world’s third largest export port for propane, normal butane and isobutane, which are known collectively as liquefied petroleum gases (LPG). These products are sold to customers worldwide.

The Kårstø processing plant. 12 Kårstø’s key role

Kårstø north of Stavanger has been transformed over the past 25 years from poor pasture to one of the world’s largest processing plants for natural gas. Its capacity has been increased fivefold since operation began in 1985 through expansions, modifications and the installation of new equipment. And almost NOK 30 billion has been invested at the site since the Storting (parliament) approved the Statpipe development in 1981.

With more than 30 fields tied back to Kårstø via Transport. Capacity at the plant was increased by pipelines, millions of cubic metres of gas and 20 per cent to 88 million scm per day. A plant to unstabilised condensate flow into the plant every remove carbon dioxide from the sales gas was day. also built as part of KEP2005.

Its original purpose was to receive and treat gas A total of 638 cargoes of propane, butane, ethane, from fields in the northern North Sea, and this naphtha and stabilised condensate were shipped remains one of its main jobs. First gas arrived on from Kårstø in 2006. 25 July 1985, with dry gas starting its journey to Emden in Germany on 15 October of the same year. Condensate is piped to Kårstø from the Sleipner The Statpipe system carries gas from the northern area of the North Sea. At the plant, it is stabilised North Sea to Kårstø. and fractionated in a dedicated facility which became operational on 1 October 1993. Roughly Value creation. Kårstø is an important link in the four million tonnes of stabilised condensate are value chain from reservoir to European customers. shipped from the plant every year. Fields in the Norwegian Sea were also connected to the European gas market with the development An expansion in 2005 increased Kårstø’s ethane of Åsgard, construction of the Åsgard Transport production capacity by more than 50 per cent to and Europipe II pipelines, and expansion of the 950 000 tonnes per annum. Kårstø plant.

Completed on 1 October 2005, the Kårstø expansion project 2005 (KEP2005) made it possible to receive rich gas from the Kristin field via Åsgard

13 The Kollsnes processing plant. 14 Kollsnes

The processing plant at Kollsnes north-west of Bergen plays a key role in Norway’s gas industry, and handles output from the Troll, Kvitebjørn and Visund fields in the North Sea.

Troll contains the largest gas reserves discovered A pipeline transports NGL from Kollsnes to the in the North Sea. Its development has been based Mongstad oil refinery further north for on piping the gas to Kollsnes for processing, which fractionation into propane, butane and naphtha. began in 1996. Kvitebjørn and Visund have subse- quently been tied to the plant. Since the Kollsnes plant came on stream, its capacity has been expanded several times. The Kollsnes process separates gas, NGL and Additions include an NGL extraction unit and a condensate. After dewatering, the gas is new export compressor. The facility can currently compressed for onward transmission to Europe process up to 143 million scm of gas and 69 000 via Zeepipe, Europipe and other pipeline systems. barrels of condensate per day.

15 Value chain for gas

Oil and gas are formed A reservoir Surveys and exploration wells Production and separation from the remains of plants, algae, is a porous, permeable rock which contains Exploring for hydrocarbons calls for modern Oil and gas can be produced from platforms or plankton and marine animals petroleum, rather like water in a wet sponge. computers, geological maps and geophysical advanced seabed installations. This wellstream, deposited on the seabed many Three types of rock are needed to create a investigations. Seismic surveys use sound which may be under high pressure and temperature, millions of years ago, and converted commercial reservoir – a source of waves generated by an explosion, which is separated into its various components before to hydrocarbons under heat and hydrocarbons, the actual reservoir and an travel through the rock and bounce back to transport and further processing. pressure. impermeable cap which creates a trap to microphones. These signals are then retain the oil and gas. interpreted to map the “terrain”. Exploration wells are drilled from rigs or ships.

RICH GAS

Oil transport NGL and condensate Oil can be brought ashore by Once separated and fractionated, propane, shuttle tankers which load butanes, naphtha and condensate are from a buoy on the field, or by transported by ship. pipeline.

Oil refining Crude oil comprises a blend of liquids or fractions with different boiling points. In the OIL refinery, these fractions are NGL separated in a distillation column and then processed into such products as heating oil, diesel oil or petrol. Gas transport Gas is transported by ship in liquefied form, or by pipelines along the seabed. Gas processing End users Rich gas is separated into various fractions by Gas is used as a fuel and as a being passed through a series of tall columns. feedstock for the petrochemical When the gas is heated at the bottom of a industry. This yields a number of column, the lightest fraction rises to the top commodities, particularly plastics. and is drawn off. This process continues until Toothbrushes, shopping bags, bottles, fractionation is complete. See the illustration mobile phones and computers are on page 29 for further details. among the products where natural gas is one of the most important raw materials.

DRY GAS

Dry gas is often called sales gas. It consists primarily of methane, but also contains some ethane.

Transport network End users Norwegian gas is transported through a network of pipelines totalling Natural gas is used in continental 7 800 kilometres in length from fields on the NCS to receiving terminals Europe and the UK by households, in continental Europe and the UK. office buildings, market gardens and other commercial activities, power stations and manufacturing. Receiving terminals are located at Emden and Dornum in Germany, Zeebrugge in Belgium, Dunkerque in France, St Fergus in Scotland and Easington in England. Transmission/distribution Norwegian gas is transported from the receiving terminals to end users in households, industry and power stations through a well-developed distribution network. 16 Oil and gas are formed A reservoir Surveys and exploration wells Production and separation from the remains of plants, algae, is a porous, permeable rock which contains Exploring for hydrocarbons calls for modern Oil and gas can be produced from platforms or plankton and marine animals petroleum, rather like water in a wet sponge. computers, geological maps and geophysical advanced seabed installations. This wellstream, deposited on the seabed many Three types of rock are needed to create a investigations. Seismic surveys use sound which may be under high pressure and temperature, millions of years ago, and converted commercial reservoir – a source of waves generated by an explosion, which is separated into its various components before to hydrocarbons under heat and hydrocarbons, the actual reservoir and an travel through the rock and bounce back to transport and further processing. pressure. impermeable cap which creates a trap to microphones. These signals are then retain the oil and gas. interpreted to map the “terrain”. Exploration wells are drilled from rigs or ships.

RICH GAS

Oil refining Crude oil comprises a blend of liquids or fractions with different boiling points. In the OIL refinery, these fractions are NGL separated in a distillation column and then processed into such products as heating oil, diesel oil or petrol. Gas transport Gas is transported by ship in liquefied form, or by pipelines along the seabed. Gas processing End users Rich gas is separated into various fractions by Gas is used as a fuel and as a being passed through a series of tall columns. feedstock for the petrochemical When the gas is heated at the bottom of a industry. This yields a number of column, the lightest fraction rises to the top commodities, particularly plastics. and is drawn off. This process continues until Toothbrushes, shopping bags, bottles, fractionation is complete. See the illustration mobile phones and computers are on page 29 for further details. NORGE SVERIGE among the products where natural gas is one of the most important raw materials.

DANMARK

DRY GAS

STORBRITANNIA

NEDERLAND TYSKLAND Dry gas is often called sales gas. FRANKRIKE BELGIA It consists primarily of methane, but also contains some ethane.

When Norwegian gas is piped to customers in continental Europe and the UK, it must first pass through a receiving terminal. We operate such facilities in Germany, Belgium, France and Britain.

18 The Dornum receiving terminal. 19 Receiving terminals in Europe cont

Last stop before the market

Gas from the NCS is piped to receiving terminals in four European countries. Upon arrival, it undergoes a final quality check, metering, and regulation of pressure and temperature before being delivered to the downstream transport operators.

Dunkerque terminal The receiving terminal for the Franpipe line stands in Dunkerque’s Port Ouest in northern France. Established jointly by Gassled and Gaz de France, this facility was completed in the summer of 1998 and is owned by Franpipe.

Deliveries of sales gas from the NCS via Franpipe to Dunkerque commenced on 1 July 1998. The terminal is remotely operated from the Zeebrugge facility.

20 Zeebrugge terminal The receiving terminal at Zeebrugge in Belgium is owned by the Zeepipe group, part of the Gassled joint venture, and Belgian company Fluxys. It is operated as an integral part of the Zeepipe system.

Zeebrugge was chosen as the Zeepipe landfall because of its proximity to gas buyers in Belgium, France and Spain.

The facility stands in the city’s port area and is linked to the landfall point by a six-kilometre over- land line.

Upon arrival at the terminal, the gas has its pressure regulated. Possible residual liquids and solid particles are removed, and the gas is metered and checked for quality before being transported on through the pipeline network to customers in Europe.

The Zeebrugge terminal became operational in 1993. 21 Receiving terminals in Europe cont

Easington terminal Langeled runs for 1 166 kilometres, making it the Upon arrival in Easington, the gas is regulated world’s longest underwater pipeline. We are also to the correct pressure and temperature before operator for this system, which starts at Nyhamna being passed into the British distribution system. in mid-Norway and terminates at Easington on the UK east coast. The southern leg of Langeled became operational on 1 October 2006, with the northern leg follow- Gas from Ormen Lange in the Norwegian Sea ing on 1 October 2007 when the Ormen Lange flows through the northern leg of Langeled to the processing plan came on stream. Sleipner platforms in the North Sea, where it is blended to ensure the right quality and sent on.

Emden hub The Emden metering station for Europipe and the Norsea gas terminal for Norpipe stand side by side outside this north German port. Emden has been a hub for Norwegian gas deliveries since Norpipe became operational in 1997.

These facilities regulate gas pressure and temperature before it passes through a hydrogen sulphide treatment plant. The gas is also metered and checked for quality.

22 St Fergus terminal This facility stands 61 kilometres north of Aberdeen in Scotland, and became operational in 1977. The terminal receives dry gas in the Vesterled system in addition to rich gas arriving through Britain’s own Flags transport system. Gassled owns Vesterled, while we are its operator.

Dornum terminal Gas comes ashore from the Europipe and Euro- pipe II pipelines at the Dornum receiving terminal in northern Germany.

This facility filters, pressure regulates, heats and meters the gas before it enters the Netra transport system or a 48-kilometre land line to Emden for further metering and distribution.

23 Draupner. 24 Riser platforms – key hubs

We also operate riser and compressor platforms related to the pipelines.

The Draupner S and E installations represent centre, and serves as a compressor facility on the a key hub in the gas transport network on the Norpipe gas line to Emden. NCS. Their main function is to monitor pressure, volume and quality. Heimdal Riser is tied to the Heimdal platform and operated as an integral part of the latter. This With seven risers (vertical pipelines) ranging installation is a hub which distributes gas from from 28 to 42 inches in diameter and associated the Oseberg Gas Transport system to the Statpipe, manifolds, these platforms play a key role in gas Vesterled and Grane lines, together with gas from transport to continental Europe. Huldra, Heimdal, Vale and Skirne.

The B-11 platform stands in the German sector of the North Sea, south-east of Norway’s Ekofisk

25 Skanled – eastward bound

We were commissioned by the Ministry of Petroleum and Energy in April 2005 to investigate interest in a gas transport system for Norway. This has proved to be high, and we presented the basic technical calculations for a solution in October 2006.

26 The transport system currently under consideration has been named Skanled. It will involve a pipeline running from the Kårstø processing plant to Rafnes in the Grenland region south of Oslo, and on to western Sweden and Denmark.

Plans call for a mix of ethane and normal sales gas to be piped from Kårstø to Rafnes. A separation plant will then remove the ethane and other heavier hydrocarbons for use in the local petrochemical industry, replacing today’s transport of such feedstock by ship from Kårstø.

Part of the sales gas will also be used in the Grenland area, while a compressor station ensures onward export of the remaining gas across the Skagerrak.

Both national and international companies have expressed interest in the project, and commercial support is now great enough to meet the full ownership requirement. A decision on implementing Skanled is due to be taken in 2009, with possible completion in late 2012.

27 Facts about gas

Many terms and expressions are used for oil and gas. Petroleum is a collective designation for hydrocarbons, whether solid, liquid or gaseous.

Gscm Condensate Giga standard cubic metres – one billion cubic Embraces the heavier fractions in natural gas, metres of gas at 0.01325 bar and 15°C. such as pentane, hexane and heptane. Condensate is liquid under atmospheric pressure CNG and temperature. Compressed natural gas. Naphtha (natural gasoline) LNG A volatile condensate which contains less of the Liquefied natural gas, primarily methane, which heaviest fractions. has been converted to liquid by cooling to -163°C at atmospheric pressure. One tonne of LNG NGL corresponds to roughly 1 400 scm of gas. Natural gas liquids. Comprise the heavier gases ethane, propane and butane as well as small LPG amounts of pentane, hexane and heptane. Liquefied petroleum gases. Consist primarily of propane and butanes. They are obtained at Kårstø ncm through fractionation and cooling. Normal cubic metre at a reference condition of 0°C and 1.01325 bar. Natural gas Petroleum components (fractions) which primarily oe comprise light hydrocarbons. These can be divided Oil equivalent. Oil and gas are often quantified as into dry gas and NGL (see below). Also known as oil equivalent. As a rule of thumb, one tonne oe = sales gas, dry gas consists largely of methane but one tonne of oil = 1 100 scm of sales gas. can often contain a certain proportion of ethane and small quantities of heavier hydrocarbons. smc Standard cubic metre at a reference condition of 15°C and 1.01325 bar.

28 Did you know that... When you clean your teeth in the morning, the Dry (sales) gas NGL brush you use is likely to be processed natural by pipeline to Europe is transported by ship gas. And if you eat a gourmet meal in a Parisian or London restaurant, the chances are good that the food has been cooked on Norwegian gas. Methane hane Et opane a

A number of well-known products which Pr te Butanes surround us, such as plastic bags and bottles, Napth mobile phones and computers, derive from Rich gas/ ndensa Co natural gas – one of the most iportant feedstocks condensate for plastics production. = heat

Extraction plant Fractionation plant

Gross calorific Composition of Dry gas value (GCV) various gas types Rich gas (Sales gas) LNG NGL LPG Condensate MJ/scm Methane 37.7 Ethane 66.0 Propane 94.0 Butanes 121.0 Naphta 150 + Condensate > 150

GCV MJ/scm 43-46 39-40 38-40 90-100 abt 100 > 150

29 The Gassled joint venture

With effect from 1 January 2003, virtually all the Norwegian transport systems were integrated in Gassled, a large new joint venture between the oil and gas companies involved on the NCS.

Gas transport on the NCS was originally organised in various joint ventures, which owned the different pipelines and terminals.

Gassled has no employees and is run through various committees with specific duties. This joint venture is the formal owner of the infrastructure for gas transport from the NCS.

Facts about Gassco

We were founded by the Ministry of Petroleum and Energy on 14 May 2001 as a limited company wholly owned by the Norwegian state. We became the operator for gas transport from the NCS on 1 January 2002.

Before our creation, such transport was operated by several companies. We were established as part of an extensive restructuring of the Norwegian oil and gas sector since 2001. Our head office is located at Bygnes in Karmøy local authority north of Stavanger, and lies roughly 15 kilometres from the port of Haugesund.

30 31 GASSCO AS P O Box 93, NO- 5501 Haugesund, Norway. Visiting address: Bygnesvegen 75, NO- 4250 Kopervik. Tel: +47 52 81 25 00. www.gassco.no