Norwegian major Statoil is planning to optimize its Norwegian Continental Shelf (NCS) portfolio via a transaction with German oil and gas company Wintershall.
Statoil announced Monday that it will exit its Brage licenses and farm down its stake in the Gjøa and Vega fields in return for a 15-percent stake in the Edvard Grieg license near the Johan Sverdrup discovery in the North Sea.
By entering the Edvard Grieg license (formerly Luno), Statoil will consolidate its position as the largest player on the Utsira High. Statoil will now hold a working interest in all the discoveries in this area: Johan Sverdrup, Edvard Grieg, Dagny and Ivar Aasen.
"The Norwegian Continental Shelf is a world class oil and gas region and with a giant discovery like Johan Sverdrup, the Utsira High has proved to be one of its most prospective areas. Adding Edvard Grieg to the portfolio further strengthens our industrial position for long-term value creation in this area. Developing the Utsira High area will be one of the major undertakings for Statoil in decades to come," said Øystein Michelsen, Statoil's executive vice president for development and production in Norway, in a company statement.
Statoil believes the transaction will help it deliver on its strategy of further revitalizing the NCS with "high-value barrels" and creating valuing through active portfolio management.
This strategy also involves the employment of 'fast-track development', where standardized solutions that involve existing infrastructure are used to develop fields rather than building all the required facilities from scratch. Meanwhile, the company has also used a number of technologies, including gas injection, to boost its average recovery rate on the NCS to a current level of 50 percent – which Statoil claims no other oil company around the world has been able to match.
"The NCS is and will continue to be the backbone of our company. By developing new fields and increasing oil recovery, it is our ambition to continue producing more than 1.4 million barrels of oil equivalent per day in Norway in 2020. This transaction enables a more focused portfolio on the NCS and positions us for further growth," added Michelsen.
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