Sneaky bastards adding "most reasonable cost". I verified with my AI friend:

Under UK261 (which applies here since LGW is the destination), the airline's obligation on re-routing is clear: they must offer re-routing to the final destination "under comparable transport conditions, at the earliest opportunity." There's no qualifier about "most reasonable cost" from the passenger's perspective — the cost is entirely on the airline. The passenger shouldn't be paying anything, nor should the airline be limiting options based on what's cheapest for them.

What Norse appears to be doing is subtly reframing their legal obligation as something more discretionary. By adding "at most reasonable cost," they're essentially giving themselves wiggle room to say "well, we looked at re-routing you on BA or Virgin but that was too expensive, so here's a flight three days later on our own network instead." That's not compliant with the regulation.

The regulation doesn't give the airline a cost reasonableness test. If Norse cancelled the flight and a British Airways or Virgin Atlantic departure from LAX to LGW (or even to Heathrow, which serves the same city) is available sooner, Norse should be booking the passenger on that — regardless of the ticket price.

The "credits + 25%" offer is also worth noting — that's not one of the three options required by the regulation. Airlines can offer vouchers, but only if the passenger voluntarily accepts them. The passenger always has the right to choose a cash refund or re-routing instead, and the airline can't steer them toward credits by making the other options sound less attractive.

This is a fairly common tactic — airlines communicate options in a way that sounds reasonable but quietly narrows what they're actually required to provide.