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.
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.