Norway plans 90% gas tax cut in blow to infrastructure investors

Norway proposed cutting tariffs to ship gas through its pipelines by 90%, in a blow to funds that have spent more than $5 billion since 2010 buying stakes in the infrastructure of western Europe's largest gas producer.

Norway proposed lowering the prices charged by Gassled, whose owners include the C$170.1 billion ($171.1 billion) Canada Pension Plan Investment Board, Toronto, the $627 billion Abu Dhabi Investment Authority and a UBS infrastructure fund, the Oslo-based Petroleum and Energy Ministry said Tuesday. The reduction would apply to new contracts.

“Norwegian policy has always been to take out the superprofits on these resources and tax it heavily,” Petroleum and Energy Minister Ola Borten Moe said Tuesday in an interview. “We're well within the boundaries of our job and our mandate as regulator. There will still be very good returns in Gassled after these changes.”

Gassled, a joint venture created in 2003 between oil and gas companies operating on the Norwegian continental shelf, owns Norway's gas transport infrastructure. Its biggest owners are now state-owned Petoro and Solveig Gas Norway.

Statoil, which is 67% owned by the Norwegian state, sold a 24% stake in Gassled in 2011 for 17.35 billion kroner ($3.1 billion), bringing its holding down to 5%. The stake was bought by Solveig, a company owned by the CPPIB, Allianz Capital Partners and Infinity Investments, a unit of the ADIA.

Royal Dutch Shell and Total also sold stakes in Gassled in 2011.

Shell in September 2011 agreed to sell its 5% stake for 3.9 billion kroner to Infragas Norge, a unit of CPPIB. Total in June 2011 agreed to sell its 6.4% stake for 4.6 billion kroner to Silex Gas Norway, owned by Allianz.