Experience of Norway and the European Union in Developing Regulatory and Fiscal Mechanisms to Reduce Methane Emissions in the Oil and Gas Industry

Introduction. This article provides a comparative analysis of the development of the oil and gas sector in Ukraine, Norway, and the European Union. A comprehensive analysis of Norway's state policy has been carried out to identify the key regulatory and fiscal instruments that have made it possible to combine high levels of natural gas production with minimal methane losses and emissions. The relevance of the study is determined by the need to adapt Ukraine's policy to EU requirements and fulfil international commitments, in particular within the framework of the Global Methane Pledge. Materials and methods. The study is based on an analysis of open data from international organisations and reports by Ukraine and Norway to the United Nations Framework Convention on Climate Change, as well as an analysis of regulatory acts relating to fiscal mechanisms and requirements for monitoring, reporting, and verification of greenhouse gas emissions. The methodology is based on a systems analysis that allows for the assessment of the interaction between institutions, economic incentives, and climate and environmental constraints in the oil and gas industry. Methane is considered in a triad: as an energy resource, a pollutant, and a greenhouse gas. The theoretical framework includes concepts of system dynamics (J. Forrester, D. Sterman), complex systems management (R. Ackoff, P. Checkland) and induced innovation in the context of climate policy (W. Nordhaus). This approach allows not only to quantitatively assess the effectiveness of Norway's and the EU's economic, energy and climate policies, but also to understand the institutional conditions for their successful implementation and functioning in other countries. Results and discussion. The article presents the results of an analysis of the effectiveness of Norway's policy to reduce methane emissions in the oil and gas sector. It is shown that through a combination of strict regulation, transparent reporting, high tax burdens on emissions, and state participation in corporate governance, Norway has achieved some of the world's lowest specific methane emissions per unit of output in the oil and gas industry. A comparative analysis of climate indicators for the oil and gas sector in Ukraine, Norway, and the EU was carried out, demonstrating higher emission intensity in Ukraine with significantly lower taxation and no mandatory MRV. Recommendations have been developed on how to use the experience of Norway and the EU to improve climate and energy policy in Ukraine, particularly in the context of European integration. Conclusions. Norway's and the EU's experience shows that integrating climate goals into development policy is possible without harming the energy sector’s economic efficiency and competitiveness. To use this experience in Ukraine, it is necessary to improve approaches to methane emissions regulation, adapt national legislation to EU requirements, introduce an adequate environmental tax on methane emissions, and develop institutional capacity in the energy sector.