Norway to examine competition conditions in oil industry

(Adds Statoil comment)

OSLO, July 20 (Reuters) - Norway's competition watchdog will look into whether competition rules are being infringed in its oil industry, the industry ministry said on Wednesday.

The ministry has asked the competition authority to provide a general description of competitive conditions for oil companies and their suppliers to answer a question from a member of parliament, it said.

The question from the lawmaker is whether oil firm Statoil (Hamburg: 1245893.HM - news) , which is responsible for 60 percent of Norway's oil and gas output, misuses its dominant position over suppliers, the ministry said.

"It is natural to prepare a political discussion about competition conditions on the Norwegian continental shelf on a good factual basis, both on the competition situation and whether us politicians can, or should, do something about it," Industry Minister Monica Maeland said in a statement.

The statement did not say how long this would take.

Last month, BP and independent oil firm Det norske agreed to merge their Norwegian business in a $1.3 billion all-share deal, partly to counter Statoil (LSE: 0M2Z.L - news) 's dominant position in the sector.

Statoil said it had a common interest with others to have a competitive industry that featured many actors, that it had brought in new operators on the Norwegian continental shelf, and it was responsible for a lesser share of total production than when it merged with the oil arm of Norsk Hydro (LSE: NHY.L - news) a decade ago.

"We work closely with the suppliers' industry to do the necessary improvements to make operations more effective, simplify, standardise and industrialise," a Statoil spokesman said.

"To cut costs is a part of ensuring competitiveness," he said, adding that Statoil would help Norwegian authorities if they wanted information from the company. (Reporting by Gwladys Fouche; Editing by Mark Potter)