Equinor Rosebank Deal Good for UK Upstream
Equinor’s deal to purchase Chevron’s stake in the Rosebank project is good for the project, the other partners in the project and the UK upstream sector, according to Wood Mackenzie.
“This deal cements Equinor's commitment to the UK upstream sector,” Kevin Swann, part of Wood Mackenzie’s Europe upstream research team, said in a statement sent to Rigzone.
“Equinor can come in and move this project forward,” he added.
Swann stated that Rosebank has been an “on-off affair” for Chevron since it was discovered in 2004 and said that the company selling its stake in the project to Equinor could spell the end for Chevron in the UK and Europe.
“It has already moved on from Norway and Denmark and is looking to offload its UK North Sea assets,” Swann stated.
“If all the sales go through, it would leave Clair as its only UK asset – the 19.42 percent stake is valuable but may not be enough for Chevron to retain a UK presence,” he added.
The Wood Mackenzie representative stated that high development costs have blighted Rosebank over the years.
“The field lies is in more than 1,000 metres [3,280 feet] of water, so it will be expensive to develop,” he said.
“However, we believe Equinor sees an opportunity to re-scope the project and reduce costs. It has done similar work on Norway’s Johan Castberg,” he added.
“Until now, Equinor’s only significant development project remaining in the UK was Mariner … Equinor also has some interesting recent discoveries and exploration prospects to go after but, to remain committed to the UK, always needed more of a foothold,” Swann continued.
Equinor announced on October 1 that it had signed an agreement to acquire Chevron’s 40 percent operated interest in the Rosebank project, one of the largest undeveloped fields on the UK Continental Shelf.
The transaction is subject to customary conditions, including partner and authority approval, although completion is targeted “as soon as possible,” Equinor said in a company statement posted on its website on October 1.
The other partners in the Rosebank field are Suncor Energy (40 percent) and Siccar Point Energy (20 percent).
“We look forward to becoming the operator of the Rosebank project. We have a proven track record of high value field developments across the North Sea and will now be able to deploy this experience on a new project in the UK,” Al Cook, Equinor’s executive vice president for global strategy and business development, and UK country manager, said in a company statement released on Monday.
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