Norway says Arctic gas pipeline could open by 2020

* "Seems to be basis" for Barents gas pipeline, study finds

* Cost would be $4 billion-plus - Gassco

* Big European gas deals needed to defend cost -minister

By Walter Gibbs

OSLO, Jan 17 (Reuters) - A pipeline extension of 1,000 kilometres (621 miles) to bring natural gas to European markets from Norway's Arctic waters could be built in eight years at a cost of more than $4 billion, pipeline operator Gassco said on Tuesday.

"A potential pipeline from the Barents Sea could be in service in 2020 and should have a relatively large capacity to accommodate potential new volumes and thus lay the foundation for continued growth in the High North as a petroleum province," Gassco said.

It said there "seems to be a basis" for such a project and that a 42-inch pipe reaching 1,000 km northward from today's terminus off central Norway would cost about 25 billion crowns ($4.1 billion) and billions more in associated infrastructure.

When state-owned Gassco began its study last summer, Foreign Minister Jonas Gahr Store said a Barents pipeline would "strengthen the Norwegian footprint in Europe and prolong our leadership as a predictable supplier of gas."

Norway's Statoil and other energy companies that would bear much of the cost have been encouraged by recent petroleum discoveries in the western Barents and a treaty with Russia that opens part of the central Barents for exploration.

Petroleum and Energy Minister Ola Borten Moe told newspaper Aftenposten that it would require long-term purchase commitments by European utilities to justify a massive pipeline configuration.

Statoil now transports gas by ship from its Snoehvit field in the Barents after super-freezing the gas into liquid form, a technology that allows it to sell gas to the highest bidder worldwide.

It is conducting its own study of whether to transport future volumes by pipeline or to expand the land-based liquefaction system.

($1 = 6.0538 Norwegian crowns) (editing by Jane Baird)