Hess Corp. has completed the sale of its subsidiary Hess Denmark ApS, which holds a 61.5% interest in the South Arne Field, to Ineos E&P AS for a total consideration of $150 million, effective January 1, 2021.
The acquisition comprises 61.5% of the HESS operated Syd Arne oil field, complementing the 36.8% share INEOS already holds and 4.8% in the INEOS operated Solsort field.
INEOS currently operates the Siri field area in Denmark. By becoming the operator of Syd Arne INEOS expects to unlock operational and cost synergies between the two assets.
The increased operated position in Denmark compliments INEOS’ leadership in the Greensands project, which recently confirmed the strong Danish consortium to progress the CO2 capture, transport and storage pilot project.
“I am pleased we have been able to complete the acquisition," Brian Gilvary, executive chairman of INEOS Energy said. "The deal represents a major step in reshaping our energy business. It also opens up prospects that can be developed in Denmark’s offshore oil and gas sector, supported by a very promising carbon storage project.”
In March, this was the first deal the company announced following the formation of its new INEOS Energy business, which incorporates INEOS’ Oil and Gas business. The Hess business in Denmark consists of operated assets focused on the production of oil.
Approximately 60 people will transfer to INEOS on completion of the deal, which is expected in the third quarter of this year, subject to government approval.
With this acquisition INEOS also plans to add further value through organic growth projects which will further extend the life of the asset within the context of the Danish Government’s decision to cease production on the Danish shelf by 2050.
“The sale of our Denmark asset enables us to further focus our portfolio and strengthen our cash and liquidity position,” CEO John Hess said. “Proceeds will be used to fund our world class investment opportunity in Guyana.”
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