The Swedish independent Lundin Petroleum has been granted approval by the Norwegian Petroleum Ministry for the transaction through which it will acquire an additional 15% interest in the Edvard Grieg field as well as interests in associated pipeline assets.
The transaction follows Statoil’s decision to divest interests in the field for an increased shareholding in Lundin Petroleum and is expected to be completed by June 30.
“The increased shareholding in Lundin Petroleum will be an important long-term industrial investment for Statoil. The transaction also underlines our long-term interest and commitment to the future of the Norwegian Continental Shelf (NCS)”, Statoil’s Executive Vice President and CFO Hans Jakob Hegge, said.
Lundin Acquisition Of Statoil’s Edvard Grieg Approved
Statoil had made the announcement earlier in May that it had signed an agreement with Lundin Petroleum to divest its interest in the field. The deal also includes divestment of a 9% interest in the Edvard Grieg oil pipeline and a 6% interest in the Utsira High gas pipeline, as well as the payment of a cash consideration of US$68 million (£47.02 million) to Lundin Petroleum.
After the transaction is completed, Statoil will own approximately 68.4 million shares of Lundin Petroleum and the two companies will continue to operate independently in all licenses in the NCS.
Lundin Increases Resources, Production & Cash Flow
According to Statoil, this transaction will enable the company to strengthen its indirect exposure to core field development projects, while for Lundin Petroleum, it will secure access to high quality reserves, production and cash flow.
“We saw a unique win-win opportunity to acquire a direct interest in a world class asset such as Edvarg Grieg for an increased shareholding in Lundin Petroleum by Statoil”, Lundin Petroleum CEO and President, Alex Schneiter, said.
“Increasing our resource base, production and cash flow at the bottom of the cycle will, in my view, lead to Lundin Petroleum emerging stronger than ever as an independent company, and continue to build upon the transformational growth already well under way, creating greater sustainable long-term value for our shareholders in the process”, he added.