Germany, Norway tie natural gas knot

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STAVANGER, Norway, Nov. 20 (UPI) -- Norwegian major Statoil announced Tuesday it signed an agreement with Germany's Wintershall to deliver natural gas to the regional European market.

Statoil said it will deliver 1.5 trillion cubic feet of natural gas to German and surrounding markets under the terms of a 10-year sales agreement.

Wintershall Chief Executive Officer Rainer Seele said the agreement benefits both companies.

"The agreement with Statoil, a long-term and reliable energy partner with Germany for decades, is a significant milestone for Wintershall," he said in a statement. "For us this means that we can also use the volumes we produce from the North Sea in Europe in the future without having to expand our own infrastructure."

Germany is the second-largest natural gas market in Europe, consuming about 2.8 trillion cubic feet of natural gas per year.

Russian energy company Gazprom this year started delivering gas to Germany through its Nord Stream pipeline system through the Baltic Sea. Both lines are designed to transport about 1.9 trillion cubic feet of Russian gas each year to European consumers for at least 50 years.

Statoil said gas would run to Germany through existing infrastructure offshore Norway and be priced "on competitive terms."