DONG Increases Norwegian Assets

DONG has strengthened its portfolio in Norway with the purchase of another two licences. On one of them exploratory drilling has just commenced.

DONG's Norwegian activities have grown steadily in the last couple of years, and now the company has added two new numbers to its list of licence shares, bringing the total so far up to 16 licences.

Last week the company signed a contract with Norsk Agip for the purchase of Agip's 40 percent share in licence PL239. Norsk Agip is a wholly owned subsidiary of Eni SpA. With this purchase DONG expects to take over the operatorship of the licence as well provided that is approved by the licence partners. The operator is the 'contractor' that takes care of all the practical work on behalf of all the partners in the consortium.

Senior Vice President Mads Arndal-Lauritzen, DONG Efterforskning og Produktion says, "Licence PL239 is situated directly north of the border between the Norwegian and Danish sectors of the Continental Shelf, and DONG is already strategically placed with licence interests and operatorships in the area, from which we also get a substantial part of our production." He expects extensive synergy between the work on this new licence and the licences DONG already has in the area.

Besides the share in PL239, DONG has acquired Norske Shell's 10 percent of licence PL256, which is situated in the central part of the Norwegian sector of the Continental Shelf.

"This is very much a long-term investment, for even if we find gas, we do not expect the field to be developed for another ten years because there will simply not be room in the existing transmission system before then," says Mads Arndal-Lauritzen. "We shall soon know if there is gas on the licence because the consortium has just begun drilling an exploratory well on the licence." He adds that the time perspective fits in well with the rest of DONG's licence portfolio, saying, "By that time, production from the finds DONG has today will be tailing off and DONG therefore needs to ensure itself access to its own gas production."

The purchase of the two licence shares has to be approved by the Norwegian authorities.

Participants in PL239 are DONG (40 percent), RWE-DEA (35 percent) and Statoil (25 percent).

Participants in PL256 are Norsk Agip (30 percent), ENI Norge (25 percent), Petoro (20 percent), RWE-Dea (15 percent) and DONG (10 percent).