Hot on the heels of a trading update in which Premier Oil plc said its UK North Sea-located Solan and Catcher field developments were back on track, the firm announced Monday morning that it is selling its entire Norwegian business to Det norske oljeselskap ASA for $120 million.
Premier said that the move to sell Premier Oil Norge AS represents the latest step in its program of active portfolio management. The proceeds will be used to pay down the firm's debt, which stood at $2.3 billion at the end of October.
Premier Chief Executive Tony Durrant commented in a company statement Monday:
"We are pleased to have reached agreement to sell our Norwegian business to Det norske, one of our long term partners in Norway. Our team in Norway has done an excellent job in bringing the Vette project close to a sanction decision in a low oil price environment. The transaction will realise immediate value from the project as part of our strategy of active management of our portfolio."
As well as the Vette development, Premier's Norwegian assets comprise the Vette adjacent Mackerel and Herring discoveries (where it is the operator with a 50-percent interest in both fields), a non-operated interest in the Frøy field (50 percent) and seven exploration licenses in the Norwegian North Sea.
The Vette field development has seen two alternative development concepts validated with the final selection of the preferred host facility for the development expected to be made before the end of this year, according to a recent statement by Premier. Project sanction for Vette is expected during the first half of 2016.
Commenting on the deal in a separate statement, Det norske CEO Karl Johnny Hersvik said that "the acquisition of Premier is another bolt-on acquisition that further underlines our firm belief in and commitment to the Norwegian Continental Shelf."
Premier has 26 employees in Norway.
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