Hammerfest with the LNG-plant behind. Photo: Odd Iglebaek
The question thus arises then to what degree do regional actors and institutions have the ability to contribute to regional economic impacts in the wake of the establishment of such huge constructions? The starting point here is the development of the Snøhvit gas field and LNG plant in Hammerfest in Finnmark County in Northern Norway. (See also the Journal of Nordregio No 3- 2008.) From 2002-2007 Norwegian-owned StatoilHydro made investments of 50 billion NOK or more in this plant. At the same time the region administered 600 million NOK, approximately the equivalent of 1.2 % of the industrial investments to support regional development.
The region's opportunities, expectations and pressures can be understood from several perspectives. In a Norwegian reform in 2002, large parts of the means and measures of regional policy were decentralized, or regionalized to the 19 Norwegian county municipalities. The intention here was to give the counties a stronger role as regional development actors.
From then on it was the regions that had the formal role in developing strategies and also the tools for developing the region in the wake of, for example, the implementation of mega-projects.
Contesting actors
Relationships between the various actors, both political and administrative in the regions, have however continued to evolve. While, according to the 2002 reform, the regional political level has responsibility for stimulating regional development this has been challenged by the new and vigorous regional strategies developed by state-owned actors not governed by the county municipalities. As such, several institutions now contest with the regional actors the role of "primary" regional developer. Examples of such actors include The Norwegian State Housing Bank, Innovation Norway and The Industrial Development Corporation of Norway (SIVA).
The region's mandate from the state is to support various development actors and to facilitate any given initiative from enterprises in the region. When a huge construction project such as the development of the Snøhvit field is established this role of facilitating enterprises does not however seem adequate enough. Actors in the region expect high level economic and strategic support when it comes to industrial networking and development which generally lie well beyond the county municipality's mandate or capacity.
Diminishing power
The political tools used to govern regional processes have also been reduced, while the power which previously lay with the regional political level has undoubtedly diminished. In the shadow of these processes significant discussions are now taking place between local and regional actors, though few concrete answers have emerged in respect of the handling of this issue as a "regional problem".
The regional level claims that more resources are needed to support regional capacity building than are currently available from the central level. In recent years, implementation of the reform has contributed to the creation of a new structural framework in which the regional level is still struggling to find its place. High expectations are placed on regional actors which they simply cannot meet.
The opportunities arising from globalisation and the expansion of certain industrial sectors have, of course, much to do with the region's own history, a history which has shaped both the region and its actors. In Finnmark this is represented by the traditional structural orientation towards fisheries and agriculture which contributed to the late arrival of industrial modernization.
Lack of training
These factors help explain why Finnmark lacks an industrial innovation culture and how the institutional systems in the regions are not oriented towards handling growth-processes. When a construction of 50 billion NOK is established the regional political level simply lacks the resources to contribute in significant ways, but this becomes even more obvious when the political level is not trained in the handling of these types of growth processes.
When Finnmark was planning how to address the construction of Snøhvit, several plans were outlined within a strategy to involve the region. Due to the regional administration's lack of training in handling such strategies however, this work was undertaken, in the main, by a single external consultant who had the experience and the networks. In addition, several rather unsuccessful initiatives were taken to deal with this issue at the regional level by people lacking in experience.
Petro Arctic
Politicians at various levels, and other enterprises attempted to established areas of communication where people met, discussed and developed strategies with a view to establishing regional momentum in respect of becoming a 'player' in the petroleum arena. This resulted in what today we know as Petro Arctic, which besides developing contact between local and regional enterprises and private companies, also contributes to the production of the information needed to handle this 'new economy' in Finnmark.
Moreover, Petro Arctic also conducted political work in trying to affect how policy is shaped in the North when it comes to petroleum. The constellations between different actors which lead to the building of new institutions are known from the literature as governance-based development. This means that decisions are formed in new ways, moving away from the traditional political orientation of government, and towards more network-based processes involving several actors at different levels.
It was in this way then that the Norwegian regional political-administrative level was altered and this is how it subsequently lost its premier regional position and role. Major decision making could thus now be seen to be taking place outside the county parliament.
In the wake of the Snøhvit project similar processes are now more or less observable in several sectors while their importance is also being magnified by the established regional institutions' lack of responsibility or skill when it comes to adapting to new challenges such as establishing the necessary higher educational institutions to drive the long term process forward. Formal responsibility for primary education is retained by the municipalities.
The county municipalities have responsibility for secondary and tertiary (e.g. state universities and colleges) education. But as a result of Snøhvit's establishment in Finnmark a serious need arose for higher educational institutions to be set up within the region because of the high level of demand created for technological and engineering competencies from both local and international enterprises.
Poker to avoid responsibilities
The result of a very long process was that institutions on various levels were playing poker to ensure that they alone did not have to take responsibility for the establishment of a new institution, subsequently entitled Energy Campus Nord. The new campus was formed by a national team of universities forced together by the county municipality. It seems clear then that the regional level ultimately took the responsibility to develop institutions which lie beyond their official mandate.
Their partnership with other political levels created new possibilities to decentralize supply when it came to higher education. It is however unlikely that such ad hoc policy making will be able to consistently meet regional expectations and needs in respect of global mega-projects with the necessary regional competence and knowledge.
Mega-projects in the oil- and gas sector constitute an important strategy concern in respect of the new Norwegian 'Northern Areas' policy priority. Handling mega-projects such as Snøhvit tests the ability of regionalization as a strategy in implementing the specific Northern-focused policy.
The results do not however specifically favour regional actors. The Finnmark 'experience' in this respect is that the partial, ad hoc or unfinished nature of the Norwegian decentralization reform process is clearly demonstrated when the regional partnership and the county municipality are forced to confront the rigours of managing a mega-project.
The regional actors' lack of funding opportunities, economic tools and training inevitably see the initiative relocated to state governed actors operating in the regions. The need to build up specific research and petro-related higher education in outlying places without established universities or regional colleges effectively unmasked the vacuum in the regional organisation of research and development policies. As such, the regions are, on the one hand, close to where the action is, but on the other, they are unable to meaningfully contribute to the expectations of the actors close to them.
The regional level can thus operate in normal situations but is simply superseded when novel situations arise. Thus, situations that should be seen as significant opportunities for the region instead contribute to the questioning of the very existence of the regional level.
By Trond Nilsen, Researcher and Sveinung Eikeland, Director of Research at Northern Research Institute (Norut), Hammerfest and Alta