Statoil has increased its ownership of Lundin Petroleum in a deal that sees the oil major exchange stakes in its offshore developments.
“The increased shareholding in Lundin Petroleum will be an important long term industrial investment for Statoil,” said Hans Jakob Hegge, Executive Vice President and CFO of Statoil.
“The transaction also underlines our long term interest and commitment to the future of the NCS.”
Statoil Increases Lundin Petroleum Ownership
As part of the agreement, Statoil will handover its entire 15 percent holding in the Edvard Grieg field, as well as its 9 percent holding in the Edvard Grieg Oil pipeline and the 6 percent interest in the Utsira High Gas pipeline.
In addition to the asset interests, Statoil will make a cash payment of US$68 million to Lundin Petroleum.
In return, Statoil will receive 27,580,806 shares in Lundin Petroleum, in creasing its current stake to a total 68.4 million shares, or around 20.1 percent ownership of Lundin Petroleum.
Statoil will through this transaction further strengthen its indirect exposure to core field development projects and growth assets on NCS.
This includes the Statoil operated Johan Sverdrup field, a world class project with a break-even of less than USD 30 per barrel for phase 1.
Independent Oil Companies
The transaction was initiated by Lundin Petroleum. The two companies will continue to operate independently, and act as separate entities in all licenses on the NCS. Statoil remains supportive of Lundin Petroleum’s management, its Board of Directors and strategy.
As a consequence of the transaction Statoil will equity account its stake in Lundin Petroleum, resulting in an increase in Statoil’s reserves and production. Statoil has no plan to further increase its shareholding in Lundin Petroleum.
In addition Lundin Petroleum will transfer 2,000,000 treasury shares and issue an additional 1,735,309 shares to Statoil in exchange for a cash consideration based on the market value of the shares.
Edvard Grieg Development
The Lundin Petroleum operated Edvard Grieg development achieved first production in November 2015. Here is a video giving an oversight of the development.