New climate requirements for offshore vessels

Norway is introducing new climate requirements for offshore vessels on the Norwegian continental shelf, targeting oil and gas operators rather than shipowners. From 2029, operators will be required to reduce the greenhouse gas intensity of fuel consumption in offshore operations, with gradually tightening requirements toward 2040.

From 2029, oil and gas operators will be required to reduce the greenhouse gas intensity (emissions per unit of energy) of vessels used in offshore operations. The requirements tighten gradually toward 2040 and are intended to accelerate the adoption of low‑ and zero‑emission technologies such as hydrogen, ammonia, electrification, and other alternative fuels.

The Norwegian energy industry was granted beneficial tax terms during Covid, resulting in heightened activity and increased emissions over a prolonged period. The new requirements are introduced as a measure to counter this rise in emissions.

The regulation enters into force with less than three years’ notice. This limits the ability of shipowners to introduce new alternative‑fuel vessels unless these are already on order. Operators are therefore likely to consider a combination of operational measures, vessel pooling, shore power optimisation, fleet rotation strategies, future OCCS solutions, or acceptance of non‑compliance penalties.

The regulation is unique to Norway and goes beyond international frameworks such as those enforced by the EU and the IMO.

The requirements have similarities to FuelEU Maritime and the IMO Net Zero Framework but are directed at operators chartering vessels. This means oil and gas operators must ensure that the vessels they use collectively reduce greenhouse gas intensity, regardless of ownership.

In practice, commercial and technical implications will flow throughout the offshore value chain. Norwegian authorities estimate that the measures could reduce emissions by approximately 1.6 million tonnes of CO₂ equivalents by 2040.

The regulation will affect a broad range of vessel categories, including platform supply vessels (PSVs), anchor handling tug supply vessels (AHTS), construction support vessels, and service and maintenance vessels.

The government has proposed a phased reduction in greenhouse gas intensity divided in 4 steps:

• 2029–2031: 10% reduction
• 2032–2034: 15% reduction
• 2035–2037: 20% reduction
• 2038–2040: 40% reduction

Key regulatory features include:

• Pooling and banking of emission reductions across vessels.
• Exclusion of liquid biofuels (including bio methanol), while biogas is permitted subject to sustainability criteria.
• No credit for wind-assisted propulsion, despite such mechanisms being recognized under international frameworks.
• Double-counting incentives for shore power and renewable fuels of non-biological origin during the initial phase.
• There does not seem to be a measure- or test bed option for methane slip, which may affect the viability of LNG and LBG solutions as default values are high.
• Potential future inclusion of onboard carbon capture and storage, subject to international regulatory frameworks.
• Non-compliance may result in fines or penalties, but their exact value is not described.

The requirements follow the trend of regulators “picking winners” by assigning preference to hydrogen, ammonia and other fuels made using precious renewable electricity.

The proposal introduces a new layer of climate‑related commercial exposure for offshore operations. As with the EU ETS, FuelEU Maritime, and IMO measures, emissions performance is increasingly becoming an operational and financial variable rather than a reporting exercise.

The regulation is expected to influence fleet investment and renewal decisions, technology and fuel strategy, contract structures and risk allocation, and tender competitiveness and long‑term asset utilisation. Several offshore shipping companies have already positioned themselves around lower‑emission vessel concepts and alternative‑fuel readiness, while recent investment decisions illustrate both opportunity and uncertainty in emerging technologies.

Companies must assess how the requirements will affect vessel competitiveness and utilisation over time and across regions. Fuel choice remains a key source of risk, as committing to a specific solution may commercially and technically lock vessels into or out of certain markets.

Operators and shipowners should therefore evaluate emissions and costs using a life‑cycle and value‑chain perspective, supported by scenario analysis that explicitly accounts for regulatory and political risk, including both tightening and potential relaxation of requirements.

What is the purpose of the new Norwegian offshore vessel regulation?
The regulation aims to reduce greenhouse gas intensity from offshore vessels by placing binding requirements on oil and gas operators rather than vessel owners.

Who is responsible for compliance?
Oil and gas operators are responsible for compliance across the vessels they charter, regardless of ownership.

When do the requirements take effect?
The regulation applies from 2029, with progressively stricter targets through to 2040.

How does this differ from EU and IMO regulations?
The Norwegian framework goes beyond international rules by targeting operators directly and setting more stringent national requirements.