Norway's ruling parties delay oil sands vote

OSLO (Reuters) - Norway’s center-left government effectively delayed a parliamentary vote on Monday on whether majority state-owned oil and gas producer StatoilHydro should withdraw from a $2 billion Canadian oil sands venture.

The oil sands issue has put the government in a bind four months before a general election, with political opponents saying state support for the oil sands project was hypocritical given the cabinet’s self-professed environmental ambitions.

Affluent Norway -- the world’s No. 6 oil exporter and third biggest gas exporter -- likes to see itself as a champion of green policies and the government even plans to make the country carbon-neutral by 2050.

It is hard to square such ambitions with activist views that producing oil from tar sands damages the environment and produces large amounts of carbon dioxide emissions.

A center-right opposition party had proposed the parliamentary resolution as a way to instruct the government on how to vote at Tuesday’s StatoilHydro shareholders’ meeting on a similar motion about Statoil exiting oil sands.

But the majority coalition of the Labor Party, the Socialist Left and the agrarian Center Party instead voted to send the motion to committee, which means it will not be voted on by parliament before StatoilHydro shareholders meet.

Without government support, the motion has no chance of passing at the shareholders’ meeting, though it has received support from a number of smaller shareholders. The government owns two-thirds of StatoilHydro shares.

Greenpeace and other activist groups have led an active media campaign against oil sands in recent days, fueled by the government’s decision to back StatoilHydro.

Statoil bought 257,000 acres of oil sands leases in Alberta in 2007 to diversify from its aging North Sea oilfields. Last year it dropped plans for a $12 billion refinery there.

Reporting by Wojciech Moskwa and Terje Solsvik; Editing by Matthew Jones