Norway’s Statoil ASA (ADR) (NYSE:STO) of Norway has sold its few major oil field stakes to OMV AG (VIE:OMV). Statoil finalized the deal in $2.65 billion with the hopes to improve its presence in Norway’s flourishing oil industry by getting more capital expenditure.
24% of Gudrun and 19 % of Gullfaks were sold by Statoil; the company also gave optional cooperation for West of Shetland, the Faroe Islands and Norwegian North Sea Statoil exploration licenses.
This transaction of company’s $2.65 billion might get a further boost of $500 million for covering extra investments. According to Helge Lund, CEO Statoil, this deal will help Statoil generate value by developing assets and getting free investment capital in some key areas in quite profitable projects. This will also pose a little trouble to Statoil that hopes to reach its goal of 2.5 million oil barrels production equivalents by 2020; the company hopes to boost production from last year’s 2 million.
The deal is going to improve the probable reserves of OMV boe by almost 320 million, which is equal to a boost of 90%. It will also increase OMV’s production for the year 2014, which will go up to 60,000 barrels by 2016. The per day boe production of OMV in its second quarter was almost 297,000; OMV hopes to increase this production to 350,000 by 2016.
According to OMV’s CEO, Gerhard Roiss, the Statoil deal is a great strategic move by OMV and is going to prove to be vital to achieve the company’s 2016 goals. It speaks for company’s focus that it places on its production activities and exploration.
Gudrun is among Statoil’s recent projects that started production in 2012 and Gullfaks is among the most developed projects.