Such was the case in the us in the 1980s after the

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Unformatted text preview: es may then have to be assumed by the producers through a larger and more diversified contract portfolio directly to buyers to replace the “old gas” under take-or-pay agreements. Alternatively, transmission companies may go bankrupt if they are not freed from or are not able to renegotiate their commitments based on a force majeure. Such was the case in the US in the 1980s after the Open Access System was introduced and the excess supply of natural gas (the “gas bubble” [see: Austvik, 2003: 17]) that followed, due to the liberalisation of the market and the drop in oil prices. Over supply of gas in the short and medium term may lead to lower investments in new production (particularly large fields) and a lower supply of gas with consequentially higher prices in the long-term. The liberalisation process is already challenging the ways Norway organises the production, transportation and sale of gas. The important question is how Norway will organise the industry so that it does not appear to put Norwegian companies into competition with each other, which will then put downward pressure on prices in the market at the expense of long-term supply. At the same time, the organization has to be done in such a way that companies are allowed...
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