Noreco Sells Stake in Oselvar, Enoch Fields

North Sea, Enoch Field
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Oselvar Field
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Noreco has signed an agreement to sell its shares in the Norwegian oil fields Oselvar and Enoch to Marubeni Corporation (Marubeni).

Noreco's main focus is finding oil and gas, and over the last years we have built a strong track record of exploration success. The final proof of success is however the ability to convert discoveries to profit. This is the case in the deal. For Noreco, this sale also releases financial and human resources and will strengthen our ability to pursue new value creating activities, said Scott Kerr, CEO in Noreco.

The consideration to Noreco is USD 43 million net of tax with effective date 01.01.2010. In addition a pro et contra settlement for 2010 will be made upon completion, estimated to around NOK 200 million net to Noreco, mainly driven by investments in the development of Oselvar. Noreco will also receive a net profit interest from the Ipswich discovery if a Plan for Development and Operations (PDO) is submitted within five years from signing of the contract. The transaction is subject to approval by Norwegian authorities.

Oselvar is an oil and gas field under development, located in license PL274 and PL274CS in the southern North Sea. The field was initially discovered in the early 1990's but subsequently relinquished. The area was awarded again in 2002 as license PL274. Noreco farmed in with 15 percent in 2007, prior to the drilling of a successful appraisal well which gave the necessary basis for a development decision. The PDO was approved by Norwegian authorities in 2009, the development is now well under way, and production start is planned for fourth quarter 2011. License PL274 also contains another discovery named Ipswich.

Enoch is an oil field located in the Central North Sea, straddling the border between Norway and UK. Noreco owns 4.36 percent of the field through its 21.8 percent share in license PL048D. The field became part of Noreco's portfolio through the acquisition of Altinex in 2007.

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