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Group of investors made concluding arguments against Norway in $4.4b

Group of investors made concluding arguments against Norway in $4.4b

OSLO: A group of investors made their concluding arguments against Norway in a $4.4 billion court case over gas-pipeline tariff cuts.

A ruling on the lawsuit brought by the group, which includes Allianz SE and Abu Dhabi’s wealth fund, won’t be handed down until September or October, Finn Haugen, an Oslo District Court judge, said on Tuesday.

Owners of about 44 percent of Gassled, Norway’s offshore pipeline network, say the government had no right to surprise them with tariff cuts of 90 percent, which are set to take effect on new gas volumes in late 2016. The investors, which also include Canadian pension funds and a fund run by UBS AG, claim the cuts will reduce Gassled’s income by 34 billion kroner ($4.4 billion) until 2028. The plaintiffs’ share is 15 billion kroner, for which they’re demanding compensation.

“The government’s attitude in this case is practically: if you want to, you’re allowed to,” Thomas Svensen, a lawyer representing the plaintiffs, said on Tuesday.

Thomas Naalsund, a lawyer representing the Petroleum and Energy Ministry, told the court that the cuts aren’t illegal and investors had no reason to assume such a reduction in tariffs would never take place.

Gassled, the formal owner of the Norwegian gas transport infrastructure, supplies about 20 percent of Europe’s gas through links to the U.K., France, Belgium and Germany.

The government made the reductions to ease costs for oil and gas explorers such as Statoil ASA as production offshore Norway has declined and as the government seeks to push farther north to tap Arctic reserves. Oil companies such as Total AS and Royal Dutch Shell Plc sold their Gassled stakes in 2011 and 2012.