PGNiG Upstream International, the Norway-focused subsidiary of Polish Oil & Gas Co., has agreed to acquire 8% interest in Gina Krog field, 24.243% in Vilje field, 24.243% in Vale field, and 6% in Morvin field on the Norwegian continental shelf from Total E&P Norge AS, a wholly owned subsidiary of Total SA, for $317 million. The deal is effective Jan. 1, 2014.
Gina Krog was sanctioned in 2013 and is under development in the North Sea, with an expected production start-up in early 2017. The project will produce 60,000 b/d of oil and 9 million cu m/day of gas. Total E&P Norge AS will retain 30% interest in Gina Krog. Statoil ASA holds 58.7% and DNO holds 3.3%. Patrice de Vivies, Total senior vice-president, Northern Europe E&P said, “With the Ekofisk South, Eldfisk II, Martin Linge and Gina Krog developments, Total’s production in Norway is set to grow between 2014 and 2017”.
Mariusz Zawisza, PGNiG chief executive, commented, “Involvement in four new fields in Norway has a special meaning for us. Firstly, it means immediate increase in production outside the country by about 60%. Second, the transaction will allow us to maintain an increased level of oil production for at least 10 years”.
PGNiG says an independent auditor estimates the acquired interest’s recoverable reserves at 33 million boe, of which 72% is oil and 28% is gas, representing a 60% increase in current resources for PGNiG in Norway.
PGNiG entered Norway in 2007 with the purchase of shares from ExxonMobil Corp. in Skarv field, where production launched at the end of 2012. PGNiG Upstream International has 12 licenses on the NCS, and says it plans to apply for additional licenses during future licensing rounds.
October 29, 2014