Seacrest Capital-backed OKEA AS has agreed to acquire the working interests of AS Norske Shell in Draugen (44.56%) and Gjoa (12%) fields offshore Norway for $556 million (OGJ Online, Sept. 13, 2012).
Deal terms call for Shell to retain 80% of the decommissioning liability of the two assets up to an aftertax cap of $78 million subject to CPI indexation and to make a future payment to OKEA of $46 million subject to CPI indexation upon OKEA completing decommissioning.
Shell’s share of the assets’ production amounted to 25,000 boe/d in 2017, representing about 14% of Shell’s Norwegian production in 2017.
The deal, “consistent with our strategy to high-grade and simplify our portfolio,” said Andy Brown, Shell’s upstream director, is part of the company’s 3-year, $30-billion divestment program that included a $3.3-billion sale in May of its stake in Canadian Natural Resources and $7.5-billion sale in March 2017 of a portion of its Canadian oil sands interests (OGJ Online, May 8, 2018; Mar. 9, 2017).
Shell retains other roles in Norway. The company is operator of Ormen Lange and Knarr; technical service provider at Nyhamna; partner in Troll, Valemon, and Kvitebjorn fields; and partner in the Norwegian full-scale project for carbon capture and storage (OGJ Online, Oct. 2, 2017).
The transaction is subject to regulatory approval and is expected to close in this year’s fourth quarter. Upon completion, OKEA will become the new operator of Draugen.
Contact Mikaila Adams at [email protected].
