• Natural Gas News

    PGNiG to Buy Shell Stakes in Norwegian Fields


The gas supplier is on a buying spree in Norway, acquiring resources to fill the Baltic Pipe project.

by: Joe Murphy

Posted in:

Natural Gas & LNG News, Europe, Premium, Corporate, Mergers & Acquisitions, Exploration & Production, News By Country, Poland

PGNiG to Buy Shell Stakes in Norwegian Fields

Poland's PGNiG has agreed to buy interests in the Kvitebjorn and Valemon producing fields in the North Sea from Shell, it announced on September 21. It did not say how much it paid.

PGNiG expects to increase its production in Norway to 0.9bn m3 in 2021 thanks to the acquisition, up 45% compared with the 2019 level. Output at the fields will later be pumped to Poland via the Baltic Pipe, due on stream in October 2022.

Under the deal, PGNiG will take a 6.45% interest in Kvitebjorn field and a 3.225% stake at Valemon. It will also gain interests in the infrastructure that carries their production to markets. 

The gas supplier has been on a buying spree in Norway over the past several years, acquiring gas resources that can be used to fill Baltic Pipe's 10bn m3/yr capacity. In May it closed the purchase of shares in the Gina Krog and Alve Nord fields off Norway, bringing the total number of licences it has interests in on the country's shelf to 31.

Kvitebjorn is situated in the northern North Sea in waters 190 m deep. It was brought on stream in 2004 using a fixed platform with fully integrated drilling modules. Its gas is piped to the Kollsnes terminal while its oil is carried via pipeline to the Mongstad terminal. Equinor serves as Kvitebjorn's operator with a 39.6% interest, while Petoro has 30%, Spirit Energy 19% and Total 5%.

Valemon is just west of Kvitebjorn in waters 135 m deep. Production was started in 2015, using a fixed platform operated remotely from land. Its condensate and gas is delivered via pipeline to Kvitebjorn. Equinor operates the deposit with 66.775%, while Petoro has 30%. The partners recently awarded a contract to Noble Drilling for three wells at the site to help boost recovery.

PGNiG's purchase will need approval from Norwegian petroleum and tax authorities.