Oil spill off Norway mostly dissolved

OSLO - An oil slick spilled from a North Sea field was dissolving far from the Norwegian coast on Friday as calmer seas allowed ships to begin a clean-up, energy group StatoilHydro said.

In Norway's second worst oil spill, some 25,000 barrels of leaked from a loading unit at StatoilHydro's Statfjord field on Wednesday, stirring a public debate about the environmental risks of opening pristine Arctic areas for drilling.

StatoilHydro said clean-up vessels were surrounding bigger pockets of the slick with booms to skim off the oil.

"We started to use the oil booms," StatoilHydro spokesman Vegar Stokset said. "From what we have observed, most of the oil has now been dissolved but there are still some smaller quantities in some areas."

Near gale conditions and high waves in the North Sea held up the clean-up but also helped dissolve the oil.

StatoilHydro said Statfjord is producing as normal.

The company said there has been little evidence of environmental damage from the spill, which is about a tenth of the 1989 Exxon Valdez tanker disaster off Alaska.

The accident has triggered calls by environmentalists to ban oil exploration in new areas of the far-northern Norwegian and Barents Seas, where the damage of any leak would be much greater.

The oil industry wants to explore new Arctic regions to sustain Norway's oil production as output from ageing North Sea fields is in decline.

Norway may open up swathes of its Arctic waters for oil activity after 2009 and the Norwegian Petroleum Directorate (NPD) plans seismic scans of some of the pristine regions in 2008.

The NPD said that in the wake of the Statfjord spill the government reaffirmed its will to carry out the seismic work, crucial in determining if the areas hold oil and gas.

"This terrible incident will not influence the collection of (seismic) data," NPD spokeswoman Eldbjoerg Vaage said.

Vaage said that strict environmental standards have been applied to the limited drilling carried out in the Barents Sea, including no emissions to the water. The new areas, if opened for drilling, will also probably have some of the toughest environmental standards technology allows, the NPD said.

Shares in StatoilHydro ended up 0.2 percent to 164.7 crowns, underperforming a 1.3 percent rise in the DJ Stoxx Oil and Gas index.