Oil and gas company Neptune Energy said Friday it had agreed to sell its non-operated interests in three producing fields and
two export pipelines on the Norwegian Continental Shelf to OKEA ASA and M Vest Energy AS.
The assets Neptune is divesting include the producing Draugen, Brage, and Ivar Aasen fields, as well as the Edvard Grieg Oil Pipeline and the Utsira High Gas Pipeline, located offshore Norway.
“As a result of this transaction, Neptune will no longer hold participating interests in these assets,” Neptune said.
OKEA will acquire a 2.2% interest in the Ivar Aasen Unit. M Vest will acquire a 0.8% interest in the Ivar Aasen Unit, 7.56 % in the Draugen field, 4.4% in the Brage Unit, 1.2% in the Edvard Grieg Oil Pipeline, and 1.8% in the Utsira High Gas Pipeline.
The agreed consideration totals up to $35 million. All decommissioning liabilities will be transferred to the buyers.
“The transaction underpins Neptune’s corporate strategy to focus its portfolio on core areas. In Norway these are the Gjøa, Gudrun, Njord, Dugong, and Snøhvit fields,” Neptune Energy said.
Jonny Hesthammer, CEO of M Vest Energy said: ‘M Vest Energy is very pleased to announce a transaction that will further transform the company, a journey that started with the acquisition of 5% of the Polarled gas pipeline in 2020. We are now partners in transportation, exploration, field development, and production licenses, and are well positioned for future growth.”
“The license partners have a high focus on extending the lifetime of the fields, increasing reserves, and reducing the environmental footprint. M Vest Energy looks forward to working with the other partners in the assets maximizing value for both the Norwegian state and our shareholders.”
OKEA said that it would pay up to $12.7 million for Neptune’s Ivar Aasen stake, dependent on the oil price in 2022. The acquisition will add to OKEA’s current holding of 0.554% WI in Ivar Aasen and increase the ownership share to 2.777% following the transaction.
“OKEA is very pleased to announce this transaction which strengthens our position in the Ivar Aasen area and represents a first step towards the
realization of our growth strategy,” says OKEA CEO Svein J. Liknes. ‘We also welcome M Vest as a new partner in the Draugen license together with OKEA and Petoro.’
Upon the completion of the transaction, OKEA’s production outlook for 2022 will increase to 18,000-19,000 boepd up from the previous outlook of 17,000-18,000 boepd.
Ivar Aasen produces oil from sandstone reservoirs. The field consists of the discoveries 16/1-9 (Ivar Aasen) and 16/1-7 (West Cable). Oil and gas are transported to the Edvard Grieg facility for final processing. From Edvard Grieg, the oil is exported by pipeline to the Grane oil-pipeline and on to the Sture terminal. The gas is exported in a separate pipeline to the Scottish Area Gas Evacuation (SAGE) pipeline system in the UK sector.
Aker BP is the operator (34.7862% WI), with other partners comprising Equinor Energy AS (41.4730% WI), Spirit Energy Norway AS (12.3173% WI), Wintershall Dea Norge AS (6.4615% WI), and Lundin Energy Norway AS (1.3850% WI).
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