A possible divestment by ExxonMobil of its Norwegian portfolio could break the record for asset sales on the country’s continental shelf, according to Rystad Energy.

The Oslo-based research firm has estimated a value of $3.1 billion for the US supermajor’s licence holdings that include stakes in around 20 producing fields, including Equinor-operated Snorre and Statfjord, and Shell-operated Ormen Lange, with combined net resources of around 530 million barrels of oil equivalent.

It stated the most valuable of these was a 17.5% interest in the Snorre field that is estimated by the firm to be worth around $700 million, with Equinor looking to boost recovery and extend the lifetime of the North Sea field to 2040 under the so-called Snorre Expansion project.

Rystad said such a transaction would be second only to the $4.26 billion sale of the state’s direct financial interest in a number of Norwegian licences when the former Statoil was partially privatised 18 years ago, but would be the biggest-ever private sale of oil and gas assets off Norway.

“The valuation implies that a combined divestment of the entire portfolio would put the transaction at the very top of pure Norwegian transactions since the SDFI spin off in 2001,” Rystad partner Simon Sjothun said.

For comparison, the biggest private transaction to date has been the $2.7 billion acquisition by the former Det Norske Oljeselskap of Marathon Oil’s country assets in 2014, with other asset deals in recent years ranging in value between $1 billion and $1.6 billion.

The prospective sale follows ExxonMobil’s earlier disposal of its stake in pipeline infrastructure owner Gassled in 2010 and the divestment of its operated field assets to private-equity backed Point Resources for a reported $1 billion in 2017.

The Irving, Texas-based giant is seeking to exit Norway after seeing declining production as it refocuses investment on more profitable areas with higher resource potential, including offshore Guyana where it has made a series of major discoveries in the prolific Stabroek block as well as Mozambique, Brazil and Papua New Guinea.

It is part of a trend by majors such as BP and Total to sell down their interests off Norway due to high costs and falling production, opening the door for smaller players willing to exploit marginal deposits.

Sjothun said the profile of ExxonMobil’s assets was “mature and declining but nevertheless sizeable in terms of current production”, with net output of around 170,000 barrels of oil equivalent per day from the company’s fields off Norway in 2017.

“A portfolio generating high cash flow and with limited tax balances, given the Norwegian fiscal regime with 90% nominal tax relief on investment, will be highly attractive for any E&P company without sufficient revenue,” he added.

Online

ExxonMobil sale 'could break Norway record'