Mon, Mar 10, 2008 page9

• Norwegian oil center seeking non-oil image

  Stavanger experienced a klondike-like boom as the oil industry took off in the 1970s. but as oil reserves fall, the town is promoting culture as a drawing card

  • By Nina Larson / AFP
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  Long considered the oil capital of Norway, the small southwestern town of Stavanger has begun hunting for a new image that will keep the money flowing in even after the oil wells dry up.

  "We really have to take advantage of the wealth we have in this town now to give us more legs to stand on going forward. We know the oil isn't going to last forever," said Helge Solum Larsen, the deputy head of the Stavanger council for city development.

  Across town from Solum Larsen's spacious city hall office sits the Norwegian Petroleum Museum, a futuristic structure of steel and concrete jutting out into the harbor, housing what one day could be the only reminder here of the booming industry that has brought so much wealth to the region.

  Amid large-scale models of oil platforms, huge machinery parts and shelved platform work suits are posters explaining how the oil industry has over a period of nearly 40 years transformed Norway and, most visibly, Stavanger.

  Since oil first began gushing on the Norwegian continental shelf in the early 1970s the Scandinavian country saw its production peak in 2001, pumping out about 3 million barrels a day.

  Stavanger, which has seen its population balloon from around 50,000 people before the black gold started flowing to some 120,000 today, counts Norway's highest density of workers in the sector.

  "Stavanger has gone through an enormous economic development since the oil was first discovered, with a Klondike-like economic expansion," said Lennart Rosenlund, a sociologist at Stavanger University.

  But few expect the fairy tale to last, and the Norwegian Petroleum Directorate, which like most of the major oil companies is based in Stavanger, concedes that "challenges are present in the shape of declining oil production, rising costs, fewer and smaller discoveries and poor recruitment."

  DWINDLING RESERVES

  In recent years, Norway, which once ranked third among oil exporters, has slipped to a fifth place and has seen its production dwindle to 2.2 million barrels a day, and the reserves off Stavanger are believed to be dwindling fast.

  "Production will continue well after 2050, but the amount will be much less," Petroleum Directorate spokeswoman Eldbjoerg Vaage said, adding that the estimate included as yet undiscovered reserves, mainly in the Barents Sea far north of Stavanger, and did not distinguish between oil and gas.

  Tarald Kleppa, a 16-year-old high school student, said he had thought a lot about going into the oil business, "because that's where the money is."

  But, "I'm not sure if I dare. I think the oil industry is going to be a bit tricky going forward," he said.

  Since the 1990s Norway has dutifully placed large chunks of its oil revenues in a vast fund, now worth more than 257 billion euros (US$391 billion), to help maintain its generous welfare system going forward, and Stavanger has begun actively trying to expand its profile in preparation for a petroleum-free future.

  "We have learned from our history that you really have to prepare for change," Solum Larsen said.

  He described how the town for hundreds of years had yoyoed between prosperous periods followed by total despair when the bottom fell out of the ruling industry, like shipbuilding in the 19th century and canned goods in the early 20th century.

  "The economic situation here has varied so dramatically that you can read the town's development almost like growth rings on a tree. For long periods of time everything stagnated. That's what we have to try to avoid this time around," he said.

  REBAPTIZED

  The town is especially focusing on transferring the technologies and know-how created in the region for the oil industry to the development of alternative energy sources.

  "Stavanger is being rebaptized from an oil capital to an energy capital," Solum Larsen said, adding that deploying windmills at sea "could easily become a new Klondike for Norway. Experts say we have excellent conditions here for that kind of renewable energy."

  The town has also, along with Liverpool, clinched the title of European culture capital this year and is offering a broad range of exhibits and cultural happenings throughout the year.

  The cultural capital title "is all about image-making," Rosenlund said, pointing out that town leaders are bargaining that "by getting creative people to move here, the jobs will follow the brains."

  "Culture is an important element in drawing people here, and more people living here will draw in more business too," Solum Larsen said.

  Stavanger is also investing in highlighting its rich history, still visible in the colorful wooden houses that make up the old part of town nestled around the harbor, to draw more tourists.

  "Stavanger will always do well," insisted Hans Josefsen, a 74-year-old florist working in one of the town's main squares.

  "This town has a lot going for it. It's not just about oil," he said.
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