DONG Energy to Acquire ConocoPhillips' Denmark Ops
DONG Energy and Phillips Petroleum International Corporation have reached an agreement on DONG Energy's acquisition of the issued share capital of ConocoPhillips Petroleum International Corporation Denmark (COP Denmark).
With the acquisition of COP Denmark, DONG Energy will acquire control of a company holding equity in three Danish licenses, which is an important part of DONG Energy's strategy to increase its production of oil and gas and to strengthen its Danish gas supply position. Particularly, the Hejre license will contribute considerably to the business. DONG Energy estimates that COP Denmark's share in said license represents between 35 and 40 million barrels of oil equivalents. Of these, 2.5 to 3 billion m3 are gas. COP Denmark is the operator of all three licenses.
"As DONG Energy has a thorough knowledge of the licenses and the area in general, our strategy is to increase our interests in the area. At the same time, the operatorship provides us with the opportunity to have a significant influence on a concept allowing for field development via Danish infrastructure, and improves the possibility of including other discoveries in the area in which DONG Energy holds interests," says Soren Gath Hansen, Executive Vice President and responsible for exploration and production in DONG Energy.
Following the acquisition of COP Denmark (which holds a 30 per cent share of the Hejre license), DONG Energy will hold 50 per cent of the license as the company already holds a 20 per cent share. COP Denmark also holds interests in two other licenses: Svane and Hejre Extension, which include discoveries and further exploration potential.
"The acquisition of COP Denmark fulfils our strategy, as it will ensure us further reserves and gas production from the Danish shelf. We will increase our equity gas position and reduce the need to purchase third party gas," tells Søren Gath Hansen. DONG Energy acquires COP Denmark from Phillips Petroleum International Corporation for USD 300 million. The acquisition includes the value of reserves and exploration potential, synergies with DONG Energy's downstream gas business, value of other assets in the company acquired and other strategic advantages.
The agreement is subject to approval by the Danish Energy Authority. Subject to this approval, DONG Energy intends, in cooperation with the other license partners, to initiate the preparation of a development plan.
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