By Nora Buli
OSLO (Reuters) - Chemicals company INEOS has signed two long-term power supply deals with utility Statkraft to secure power for its current activities and planned investments into electrification and hydrogen production in Norway, the firms said on Friday.
One deal for around 0.88 terawatt hours (TWh) of annual production replaces an existing power contract expiring in May 2023 for INEOS subsidiary Inovyn's sites at Rafnes and Porsgrunn in southern Norway.
A second agreement set to start in 2026 covers an additional 0.26 TWh, they added.
The second deal is linked to INEOS Inovyn's plans for electrification and hydrogen production at Rafnes, expected to cut carbon emissions by an additional 40%, they said.
Both agreements are sourced from state-owned Statkraft's renewable hydropower assets in Norway.
"These long-term green energy supply agreements allow us to continue to competitively supply our customers in Europe and elsewhere in the world," Geir Tuft, the head of INEOS Inovyn, said in the statement.
The companies did not disclose the exact contract length nor price for either contract, but Statkraft told Reuters they would run beyond a seven-year period, based on an inflation-adjusted fixed price.
INEOS produces fundamental raw materials for sectors including the automotive, building, food, healthcare and pulp and paper industries.
The Norwegian government has been urging the country's power producers to offer energy-intensive industry competitive fixed-price deals to counter an unprecedented 180% rise in wholesale electricity prices in southern Norway last year.