EFTA Surveillance Authority Clears Support to Development Phase of Industrial CCS project at Mongstad (Norway)

EFTA Suveillance Authority (ESA) adopted on 15 March 2012 a decision not to raise objections under state aid rules concerning the financing by the Norwegian state of the development phase for the industrial carbon capture and storage (CCS) project in Mongstad.

Hereafter is a copy of the press release published by ESA:

"The Authority has already approved State aid to finance generic research in a small CCS facility at the Mongstad Test Centre. The Norwegian State will now finance technology and feasibility studies for an industrial scale CCS facility. These studies will be the basis for the decision on the financing of the construction and operation of the CCS facility, which the Norwegian Parliament (Stortinget) will take no later than 2016.

The aid for the development phase, which amounts to NOK 2.85 billion (EUR 375 million), is granted on the basis of an agreement between the State, Gassnova and Statoil. Under the terms of this contract, Statoil acts as a project executioner and will subcontract technology vendors and other suppliers in line with national and EEA procurement rules. The State will cover 100% of the costs incurred by Statoil in the course of the project execution. The aid to Statoil is well targeted to promotion of CCS while limiting possible distortions of competition and negative effects on trade.

The State will also cover the costs of Gassnova, which amounts to NOK 200 million (EUR 375 million). However, Gassnova will merely supervise the project execution without being involved in economic activities. The Authority has therefore taken the view that the funds allocated to Gassnova in the context of this project do not involve State Aid." (My underlying)