INEOS E&P, a part of INEOS Energy, said Thursday it had entered into an agreement to acquire the U.S. oil firm Hess’ subsidiary Hess Denmark for a total consideration of $150 million. Hess said it would use the cash on its operations in Guyana.

The deal comprises 61.5% of the HESS-operated Syd Arne oil field, complementing the 36.8% share INEOS already holds and 4.8% in the INEOS operated Solsort field. The Hess business in Denmark consists of operated assets focused on the production of oil.

Approximately 60 people will transfer to INEOS on completion of the deal, which is expected in the third quarter of this year, subject to government approval.

INEOS currently operates the Siri field area in Denmark. By becoming the Operator of Syd Arne INEOS expects to unlock operational and cost synergies between the two assets, INEOS said.

“With this acquisition, INEOS also plans to add further value through organic growth projects which will further extend the life of the asset within the context of the Danish Government’s decision to cease production on the Danish shelf by 2050,” the company added.

“The stronger operated position in Denmark fits well with INEOS’ leadership in the Greensands project, which plans to safely and cost effectively permanently store up to 8 million tonnes of CO2 per annum, in the INEOS operated Siri area, when the fields have ceased production,” INEOS said.

Brian Gilvary, Executive Chairman of INEOS Energy said, “This deal represents a major step in reshaping our energy business. Hess was one of the earliest pioneers in developing this basin. This deal will open up future growth prospects that can be developed in Denmark’s offshore oil and gas sector, supported by a very promising carbon storage project helping to deal with future emissions.

“The Greensands project in Denmark will make a significant contribution to our understanding and growth of carbon storage technology, whilst supporting Denmark’s wider CO2 emission reduction targets for 2030 and beyond.”

“The sale of our Denmark asset enables us to further focus our portfolio and strengthen our cash and liquidity position,” CEO John Hess said. “Proceeds will be used to fund our world-class investment opportunity in Guyana.”

The South Arne Field produced an average of 5,800 barrels of oil equivalent per day net to Hess in the fourth quarter of 2020.

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