OMV Acquires North Sea Assets For US$2.65 billion

Transaction Type
Announce Date
Post Date
Estimated Price

To acquire offshore oil and gas fields in Norway and the UK, west of the Shetland area.

OMV, an integrated, international oil and gas company, announced on Aug. 18 that it has reached a $US2.65 billion deal with the Norwegian company Statoil to acquire assets in Norway and the United Kingdom west of Shetlands area.

OMV has acquired 19% of the producing Gullfaks field and 24% of the Gudrun field, both of which are oil and gas fields offshore the Norwegian Continental Shelf. In addition, OMV will take over 30% of the Rosebank and 5.877% of the Schiehallion fields, both of which are located west of the Shetland Islands. The agreement with Statoil also involves options for 11 exploration licenses.

An integral part of the transaction is a research and development partnership with Statoil to develop new technologies for the exploration of gas and oil from mature fields. According to an OMV news release, the company’s comprehensive expertise in onshore enhanced oil recovery is an ideal complement to Statoil’s experience in offshore enhanced oil recovery.

OMV’s CEO, Gerhard Roiss, said, “The transaction will provide a huge boost to OMV’s strategy and will be a key factor in achieving our 2016 targets. It confirms OMV’s clear focus toward increasing the significance of its E&P activities. We are acquiring significant positions in developments lying at the heart of our North Sea growth region. The development capital will be largely funded by the operating cash flows of the already producing assets that are part of the portfolio, while the purchase price represents a reinvestment of the proceeds we have generated from disposals and working capital reductions from our downstream divisions during the last 18 months.

“Furthermore, the agreement to partner with Statoil on exploiting a number of exploration activities in the North Sea and west of Shetland area, as well as the agreement to jointly work on enhanced oil recovery research, adds both to our know how as well as the size of our exploitable asset base in the long term.”

Helge Lund, president and CEO of Statoil, said, “The Norwegian continental shelf is a world-class oil and gas region and Statoil is the largest operator. Over the past years we have delivered strong exploration results and we continue to increase the oil recovery from mature fields. Today’s transaction unlocks resources for continued investment in our core areas. OMV is a competent and experienced company and we are also pleased to extend our partnership on exploration opportunities and enhanced oil recovery technologies.”

The purchase price as per effective date Jan. 1, 2013, amounts to US$2.65 billion and is subject to customary adjustments, which are expected to be about US$500 million.

The transaction will be largely funded out of the proceeds already generated by working capital reductions and disposals from OMV’s downstream business segments and the company’s cash flow. In the first half 2013, OMV had a cash flow of around EUR$1.6 billion and existing credit lines.

Closing of the transaction is expected around year-end 2013.