Norwegian gas network operator Gassco has signed an agreement with Canadian energy infrastructure giant Enbridge to press ahead with studies on a 350 megawatt wind farm that would be used to help provide power for its gas processing plant at Nyhamna.

In August, Enbridge revealed plans for its 350 MW Havsul wind farm off Norway that would use 40 ultra-large turbines mated to concrete gravity base foundations (GBFs) in about 30 metres of water by 2021 or 2022.

The company aims to supply power to Gassco’s processing plant at Nyhamna, which would potentially allow it to take advantage of tax reimbursements of 78%, amounting to the petroleum tax rate in Norway.

Gassco has now agreed to look more closely at the plans.

Senior vice president for staff and business support at Gassco, Randi Viksund, told Upstream that the network operator is looking at opportunities to strengthen the regularity of operations at the plant and that a robust power supply is a central part of that aspiration.

“Gassco has received a request from Enbridge to conduct a technical pre-study to investigate the possibility to connect Havsul 1 to Nyhamna,” she said.

She added that a deal to carry out such studies has been signed, but that the work has barely begun so it is too early too say what the outcome might be.

Viksund did not want to comment on the possibility of significant tax reimbursements from the development of a wind farm dedicated to Nyhamna.

Norwegian tax authorities are currently considering how to deal with plans to tie different wind energy projects, such as Havsul 1 and Equinor’s Hywind Tampen, directly to oil and gas installations.

A spokesperson at the Norwegian Ministry of Finance told Upstream that the Norwegian Tax Administration will consider these applications individually, and that the ministry will not discuss single cases publicly.

However, well-placed sources said the ministry is in a difficult position: while the political leadership in the government wants more investment in renewable electricity generation, approving such plans could undermine the petroleum tax regime.

Norway is already well supplied with hydro power, which accounts for more than 90% of its electricity, meaning that the Nyhamna plant already runs on clean energy.

University of Stavanger professor of petroleum economics and petroleum tax expert Petter Osmundsen said that allowable cost deductions under the petroleum tax regime should be reasonable and serve to create a resource rent.

Linking a costly wind farm to a plant that is already served by power from the national grid does not fit this picture, he said.

Osmundsen added that making exceptions is not a valid option, as “discrimination in tax practice" would undermine the credibility of the petroleum tax system.

According to project owner Enbridge, power from the Havsul development could be exported to a substation on the North Sea island of Haroya via high-voltage 66 kilovolt lines, and then on to landfall at Gossa, for transmission to Nyhamna.

“We hope to take a final investment decision in the coming months,” Enbridge divisional director Martin Langham told Upstream’s sister publication Recharge during ONS 2018 in Stavanger at the end of August.

“It is a project uniquely placed to deliver power to the Nyhamna gas processing facility,” he said.

Though the turbine model for Havsul has yet to be decided, Langham said Enbridge was leaning heavily toward using GBSs due to the Norwegian offshore contracting sector’s historical expertise in this alternative foundation technology, which uses sheer weight rather than piles for seabed anchoring.

Exceptions: University of Stavanger petroleum economics professor Petter Osmundsen