The Orlen Group, through its subsidiary PGNiG Upstream Norway (PUN), has agreed to acquire the entire shares of KUFPEC Norway, a subsidiary of the Kuwait Foreign Petroleum Exploration Company (KUFPEC), for $445m.

The acquisition includes interests in five oil fields, Gina Krog, Sleipner Vest, Sleipner Ost, Gungne and Utgard, where the Orlen is already active.

Orlen intends to transport the gas produced from the five fields to Poland through the Baltic Pipe pipeline.

In addition to the five producing fields, Orlen will acquire an interest in the Eirin gas field, which is planned to be developed through a tie-back to Gina Krog infrastructure.

The transaction is expected to be completed by the end of this year, subject to receipt of regulatory approval by the Norwegian authorities, with an effective date of 1 January 2023.

Upon closing of the acquisition, Orlen will have 94 licences on the Norwegian Continental Shelf (NCS) to become the fifth largest licence holder among companies operating in the area.

The company’s natural gas output in Norway will be increased by one-third, to reach more than four billion cubic metres (bcm) per annum.

Also, its daily hydrocarbon production is expected to cross 100 thousand barrels of oil equivalent (boe) by the end of 2024.

Orlen management board CEO and president Daniel Obajtek said: “With the acquisition of KUFPEC Norway, the ORLEN Group’s gas production in Norway is set to grow by more than 1bcm per year.

“This significantly enhances our capacity to meet the demand of the Polish market and the entire region by utilising our own gas resources.”

Orlen said that the current agreement differs from the PUN’s previous acquisitions in Norway, by covering all shares in KUFPEC Norway along with all its assets.

The transaction consideration of $445m includes the value of the acquired fields, along with the value of the remaining assets of KUFPEC Norway, including the significant cash balance.

PUN intends to finance the acquisition of KUFPEC Norway with funds generated by its operations on the Norwegian Continental Shelf.

It is the Polish company’s second transaction in Norway this year, following the purchase of interests in the Sabina and Adriana fields in the Skarv production area.

Obajtek added: “Beyond advancing the ORLEN Group’s strategic goals, this transaction brings synergies that boost our development potential in Norway.

“We have secured control of fields where we already hold direct interests acquired through previous transactions, this will ensure seamless integration of the acquired assets, optimisation of operating costs and, by significantly scaling up our operations, access to attractive funding for further investments.”