Equinor sells stake in mature Irish gas field
Norwegian state oil producer Equinor announced on November 29 that it had agreed to sell its 36.5% stake in the Corrib gas field off Ireland to its operator Vermillion Energy for $434mn.
Equinor said the decision was in line with its strategy, "to capture value from the current strong market and to free up capital that we can re-invest elsewhere." The deal is subject to approval from project partners, government and regulatory bodies, and will have an effective date of January 1, 2022.
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Corrib was brought on stream in 2015 but its output is already in decline, expected to average around 160mn ft3/day this year, according to Equinor. With the closure of the Kinsale fields last year, it is now Ireland's only source of domestic gas supply.
Vermillion currently operates Corrib with a 20% share, while a further 43.5% interest is held by Nephin Energy. As part of their deal, Equinor and Vermillion have agreed to hedge around 70% of the field's production in 2022 and 2023, and the former will receive a contingent payment for its stake if European gas prices exceed a given floor level.
The sale means Equinor no longer has a business presence in Ireland, having recently opted against developing a $2.3bn floating wind farm in the country.