Noreco's acquisition from Shell includes the proven and probable (2P) reserves of 195million barrels of oil equivalents per year, and the seller’s share of production of 57,000 barrels of oil equivalents per day
Image: SOGU holds a 36.8% non-operating interest in the Danish Underground Consortium (DUC). Photo: Courtesy of Adam Radosavljevic from Pixabay.
Royal Dutch Shell, through its affiliate Shell Overseas Holdings, has completed the sale of its shares in Shell Olie-og Gasudvinding Danmark (SOGU), to Norwegian Energy Company (Noreco) for a consideration amount of $1.9bn (£1.5bn).
The transaction, effective from 1 January, 2017, is completed following the receipt of regulatory approval by the Danish authority.
SOGU holds a 36.8% non-operating interest in the Danish Underground Consortium (DUC), a joint venture with 15 producing fields and related infrastructure.
Shell retains oil and gas lifting rights from the DUC assets for a period of time
Following the transaction, Shell Trading and Supply and Shell Energy Europe will retain oil and gas lifting rights from the DUC assets for a period of time, along with its downstream presence in Denmark through A/S Dansk Shell, which includes the Fredericia refinery.
The acquisition, agreed and announced on 17 October, 2018, sees Noreco become the second-largest oil and gas producer in Denmark, with a stake in the DUC and considerable exploration and production in the North Sea.
Noreco chair of the board Riulf Rustad said: “With the successful completion of this transformational acquisition, we will now work closely with the operator to maximise recovery of proven reserves and resources. We will seek to continue value creation also by exploring new opportunities in the DUC concession and elsewhere.”
The transaction includes the proven and probable (2P) reserves of 195million barrels of oil equivalents per year, of which 66% are liquids, and the seller’s share of production from DUC was 57,000 barrels of oil equivalents per day.
Recently, Shell Offshore completed the sale of 22.45% non-operated interest in the Caesar-Tonga asset in the US Gulf of Mexico.
The Caesar-Tonga field is operated by Anadarko Petroleum, with a stake of 33.75%, and following the completion of the transaction, the remaining stake is owned by Equinor with 46%, and Chevron 20.25%.
The company said that the transaction indicates its focus on strategically positioning the deep-water business for growth and complements its strategy to take up competitive projects.