Funds baulk at Norway gas transport tariff proposal

Thu Feb 28, 2013 11:39am EST
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* Three Gassled partners protest government tariff proposal

* Investing in Arctic pipeline on hold -partner

* Minister says he has "heard the message"

By Gwladys Fouche

OSLO, Feb 28 (Reuters) - Several partners in Norway's gas pipeline system are considering withholding future investments, including in the key Polarled pipeline, after the Nordic country proposed a cut in tariffs on natural gas transport for new gas contracts.

In January the government said it would lower the tariffs to encourage higher production in mature fields and more exploration in the frontier areas of the Arctic.

Since then, at least three of the partners in the system, called Gassled, have protested against the proposal as it greatly cuts their profits.

These partners represent several international investments funds, such as the Abu Dhabi Investment Authority, the Canadian Pension Fund, German insurer Allianz, Swiss bank UBS and France's Caisse des Depots.

They have spent $5.1 billion in recent years acquiring stakes in Norwegian pipelines, then considered a safe and steady investment bet.   Continued...