OSLO – Norwegian oil and gas company Statoil ASA said Monday it has entered two deals with U.K. energy company Centrica to sell gas for ten years and divest five assets on the Norwegian continental shelf for a combined value of $18.8 billion.
Evaluated on the current spot price, the gas sales to the British market are worth around 100 billion Norwegian kroner ($17.2 billion), Statoil spokesman Morten Eek said.
The sales agreement follows on from an existing deal between Statoil and Centrica that expires in 2015.
Statoil said the gas volume in the deal represents around 5 per cent of the total gas used in the U.K. and corresponds to the gas consumption of 3.5 million homes.
“I warmly welcome this announcement, which underlines the strength and depth of the partnership that the U.K. and Norway enjoy,” British Prime Minister David Cameron said in a statement. “Gas plays a central role in powering our economy, and will continue to do so for decades to come. Today’s agreement will help to ensure the continued security and competitiveness of gas supplies to Britain, from a trusted and reliable neighbour.”
Statoil said the asset sale is worth $1.6 billion. It involves partial or full divestment of its activities in the gas production, development and export hubs Kvitebjoern, Heimdal, Valemon, Skrine-Byggve, Fulla, Frigg-Gamma-Delta, Vale and Rind.
“As well as being the second largest gas producer in the U.K., we also have one of the fastest growing exploration and production businesses on the Norwegian continental shelf,” Centrica Chief Executive Sam Laidlaw said. “Much of the gas acquired through this transaction will also come to the U.K. market, providing further energy security for British Gas customers long into the future.”