Norway oil, gas terminals shut after tanker collides with ship

OSLO and LONDON (Bloomberg) -- The operators of the Sture oil terminal and the Kollsnes gas processing plant shut down the facilities on Norway’s west coast on Thursday as a precautionary measure after a crude tanker collided with a military vessel nearby.

The damaged military frigate was towed to shore and a salvage operation is underway, but there was no indication of leaks from the tanker, the Sola TS, the Norwegian Coastal Administration said in a statement.

Key insights

The importance to the oil market mostly rests on how long Sture stays shut; shipping accidents rarely close ports for long periods unless a facility is damaged or directly affected; since the shutdown is a precaution, that’s unlikely to be the case here Sture, operated by Equinor ASA, shipped about 316,000 bpd in October, according to tanker tracking data compiled by Bloomberg. That represents about 17% of loadings of the main North Sea grades. The biggest flow from Sture is Grane crude, but of potentially greater significance for the oil market is the fact the terminal exports Oseberg, one of five North Sea crudes that make up the global benchmark Dated Brent.Oseberg flows this year have been about 90k bpd compared with total benchmark flows of about 970k bpd. The tanker involved in the collision was carrying 625,000 bbl of crude, NTB reported. The impact on gas deliveries from Kollsnes was estimated at 30 MMcmd for 12 hr, according to Gassco AS, the operator of the plant. It revised an initial estimate of 100.7 mcm.