Sequa Pulls Norwegian Deals
Netherlands-registered Sequa Petroleum is pulling out of its planned acquisition of a 15% stake in Gina Krog from French major Total, it said April 19, owing to "current market conditions."
The deal, announced in October 2015, had already been approved by Norway. It is also pulling out of deal to buy a 0.554% interest in the Ivar Aasen field from Austria's OMV, as announced on November 2015. Both fields are in the Norwegian sector of the North Sea.
Oil prices fell on April 18 after Opec producers failed to agree an output freeze at their weekend meeting in Qatar. They rallied slightly on April 19 because of a strike by oil workers in Kuwait, but remain in the low $40s/bbl.
Sequa, whose main office is in London, said trading in a related $300mn bond would be unblocked before close of trading April 19.
A month ago Sequa was still upbeat about completing its Gina Krog deal, saying that the field was within budget and on schedule for first production in Q2 2017, with opex and capex each calculated at $15/boe. The field is estimated to cost Nkr 32bn ($3.9bn) to develop.
Sequa in October said its Gina Krog deal would be “funded through a combination of debt and equity”. There was no indication what penalty payments if any would now be due to Total and OMV.
Gina Krog oil, gas and condensate field shareholdings will now remain: Statoil (operator) 58.7%, Total 30%, Polish state-run PGNiG 8% and Det Norske 3.3%. The field has reserves of 106.3bn bbls oil, 12bn m³ gas and 3.3 million metric tons condensate. Sales gas will be exported from Sleipner A via Gassled (Area D) to the market.
Licensees in Ivar Aasen, also under development, are: operator Statoil 41.473%, Det Norske 34.7862%, German trio Bayerngas Norge 12.3173%, Wintershall 6.4615% and VNG 3.023%, Swedish Lundin 1.385% and OMV 0.554%. The field has reserves of 146.55 bbls oil, 4.4bn m³ gas and 0.9 million metric tons condensate. Both oil and gas will be transported to the Edvard Grieg platform for process/export.
In 2015 Sequa acquired Norwegian exploration company Tellus Petroleum.
Mark Smedley