PGNiG to acquire Shell’s stakes in Kvitebjørn and Valemon fields

PGNiG Upstream Norway has agreed to acquire the stakes of Norske Shell in the producing Kvitebjørn and Valemon fields in the Norwegian North Sea.

Norske Shell is a subsidiary of Royal Dutch Shell, while PGNiG Upstream Norway is a subsidiary of Polish state-controlled oil and gas company PGNiG.

The financial terms of the deal were not revealed.

After the completion of the deal, PGNiG Upstream Norway will have a 6.45% stake in the Kvitebjørn gas and condensate field and a 3.225% stake in the Valemon gas and condensate field.

Located in the northern part of the North Sea, the Kvitebjørn gas field was discovered in 1994 and was brought into production in 2004.

The Valemon gas field is located just west of the Kvitebjørn field. It was discovered in 1985 and was brought into production in 2015.

Additionally, the PGNiG subsidiary will buy a stake in the infrastructure used for transporting hydrocarbons produced from the two North Sea fields.

PGNiG to acquire Shell’s stakes in Kvitebjørn and Valemon fields. Photo courtesy of Warszawska róg Szerokiej w Tomaszowie Mazowieckim, w województwie łódzkim, PL, EU, CC0/Wikipedia.org.

As per the estimates of PGNiG Upstream Norway, the acquisition will boost its average daily production of oil and gas by nearly 30%.

PGNiG Group’s own gas production in Norway will move up to 0.9 bcm in 2021, which is about 30% more than the previous forecast.

According to the Polish energy company, gas produced from the Kvitebjørn and Valemon fields, along with volumes coming from the previous acquisitions made by its Norwegian subsidiary between 2017 and 2020, will be transported to Poland once the Baltic Pipe link begins operations.

Jerzy Kwieciński – President of the Management Board of PGNiG said: “This latest transaction involving assets on the Norwegian Continental Shelf is closely in line with the PGNiG Group’s strategy. Its purpose is to diversify gas supplies and improve Poland’s energy security in reliance on our own reserves.

“As with the transaction completed earlier this year whereby we increased our interest in the Gina Krog field, also this acquisition will translate into an immediate and substantial increase in gas volumes produced by our subsidiary on the Norwegian Continental Shelf, with a positive effect on the PGNiG Group’s overall operating performance.”