OMV Announces $2.65 bn Purchase of Statoil North Sea Assets
Austrian oil and gas giant OMV is buying North Sea oil and gas assets from Norwegian group Statoil for $2.65 billion (1.99 billion euros), the two companies announced on Monday.
The deal also covers collaboration on possible exploration off Norway and west and north of the Shetland Islands, as well new technologies for extracting hydrocarbons from mature fields.
The agreement enables OMV to diversify away from production in the unstable Middle East/North Africa region, and Statoil said it would use the money to develop new opportunities, notably on its continental shelf.
It also announced the discovery off Norway of gas and condensates amounting to 25-47 million barrels of oil equivalent, which was recoverable, on the basis of initial estimates.
The price of the OMV-Statoil deal is tied to performance of the assets in 2013, and OMV said that this could add 500 million euros, taking the total value above $3.0 billion.
Under the deal, the biggest in OMV's history, the Austrian firm will take large shares of oil fields both off the coast of Norway and in British waters west of the Shetland Islands, OMV said in a statement.
A key part of the accord also calls for the collaboration of the two firms "to develop new technologies for the extraction of oil and gas from ripe fields," it added.
OMV said that the agreement, apart from boosting its reserves, will "increase our presence in politically stable countries."
OMV's production in countries such as Libya, Iraq and Yemen has repeatedly come under strain in the past few years.
"The agreement with Statoil to secure further exploration options in the north and west of the Shetlands, reinforces our long-term development potential," said OMV's chief executive Gerhard Roiss.
Joint cooperation on how best to exploit oil and gas fields "will strongly contribute to our know-how," he added.
The deal includes an option for OMV to acquire 11 further exploration licences in the same region.
Under the agreement, the Austrian company will take over 19 and 24 percent, respectively, of the Gullfaks and Gudrun fields off the Norwegian coast.
West of the Shetland Islands, it will also increase its share in the Rosebank field to 50 percent -- from a previous 20 percent -- and double its stake in Schiehallion to 11.8 percent.
About 70 percent of the fields' production is oil, with 30 percent gas, OMV said.
In Oslo, Statoil said that it was selling 24.0 percent of two gas fields which it operated.
One of these is the Gullfaks field which produces 26,000 barrels of oil equivalent per day and the other is Gudrun, due to begin production in 2014.
The deals means that Statoil's interest in each field will fall to 51.0 percent.
It is also withdrawing from two oil fields off Scotland for which it is not the operator. This are the Schiehallion field run by BP and Rosebank, operated by Chevron.
Statoil said it expected the sale to yield a capital gain of $1.3-1.5 billion and that it would use the funds raised to invest in highly profitable projects in strategically important regions.
These included recent discoveries on the Norwegian continental plateau.
Statoil said that it had signed a partnership agreement with OMV covering potential cooperation on opportunities for exploration on waters off Norway and the Shetland Islands, and also in the development of enhanced oil recovery (EOR).
EOR covers the technologies for lifting oil and gas typically with the injection of water or chemicals.
In Oslo, the price of shares in Statoil was showing a gain of 1.32 percent.
Source: Agence France Presse
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