EMGS lifts North Energy stake

Onboard: North Energy is using technology of EMGS, which is also a substantial shareholder

Norway’s Electromagnetic Geoservices (EMGS) is boosting its stake in North Energy after converting part of a loan into shares in the explorer, which has also increased its interest in a Norwegian Sea licence.

EMGS will hold a 9.96% shareholding in the Alta-based independent after conversion of Nkr28.4 million ($4.6 million) of a Nkr75 million convertible loan issued by the electromagnetic (EM) survey player under a strategic deal between the pair struck earlier this year.

“North Energy has established its strategy on the use of EM technology as an integrated part of the company's exploration workflow. We are excited to become a substantial shareholder, as well as exploring mutually beneficial opportunities with North Energy going forward,” said EMGS chief executive Roar Bekker.

The company will also gain Nkr900,000 in interest payments under the transaction, with the outstanding Nkr46.6 million of the loan, plus Nkr1.5 million in interest, to be settled in cash on 2 September.

North Energy is meanwhile set to acquire an additional 20% stake in production licence 484 in the Norwegian Sea under an asset swap deal with Explora Petroleum, which will gain in return a 10% interest in PL722 in the Barents Sea.

It mirrors a similar swap transaction carried out last week with compatriot Noreco whereby North Energy gained a 15% stake in PL484 to enter the licence, where it has identified a number of potential prospects after a recent failed well at Verdande.

North Energy will therefore hold a 35% interest in the licence on completion of the deals, subject to official approval, leaving operator Noreco on 15%, Explora 10%, Dana Petroleum 30% and E.ON E&P 10%.

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