By Victoria Klesty

OSLO (Reuters) - When Norwegian ferry captain Jon Olsen asked the young policeman to cover his gun so as not to upset children on an island summer camp last July, he could hardly have expected that within minutes the officer would turn into a mass murderer.

Olsen told Anders Behring Breivik's trial on Thursday how Breivik, wearing a police uniform, had obliged and covered the gun in a plastic bag, saying he was just there to protect the camp after a terrorist attack on Oslo hours earlier.

Olsen even helped Breivik with his bags on arrival at the island of Utoeya, only to watch him unwrap the gun and shoot Olsen's girlfriend Monica point-blank, starting a killing spree that claimed the lives of 69 people, most of them teenage campers.

"I think Monica says something, or I did, about how he could cover his rifle, because the mood at Utoeya is a bit tense," Olsen said.

Olsen's voice betrayed little emotion. He said the shock had probably erased much of his memory.

"I see he shoots (security guard) Trond Berntsen from behind and I see Trond fall down. I don't remember if I can see him shoot Monica or not, I think I do."

Standing about 10 meters away, Olsen fled for his life into the woods and waited - in vain - for help to arrive.

"I started to feel the desperation creep into me," he said. "It's completely quiet ... we're thinking this is completely unreal. The sky should be full of helicopters."

Norwegian police, distracted by Breivik's earlier bomb attack that had killed eight people in Oslo, have been criticized for not responding faster to the calls for help from Utoeya.

Olsen finally returned to his boat, after Breivik had moved on, to ferry a handful of people back to the lakeshore, lying down flat in fear that Breivik would fire at the boat.

Breivik, who says his teenage victims were fair game because they were politically active, listened impassively to Olsen's account in a courtroom specially built for the trial, now in the third of its expected 10 weeks.

Olsen said he and his girlfriend had thought the summer camp an inviting target for a terrorist attack.

"We had talked about that, Monica and I, how that could happen," he said. "Gaddafi had said he would send terrorists ... I thought he (Breivik) was sent from Libya."

Breivik has admitted the killings but denies criminal responsibility, saying was defending Norwegian ethnic purity from Muslim immigration and the multiculturalism promoted by the Labour party.

(Editing by Kevin Liffey)