Hungarian exploration outfit MOL Group has made its first step into the Norwegian offshore sector, purchasing the Norwegian assets of UK-based North Sea exploration and production firm Ithaca Energy.
Ithaca will sell its Norwegian assets, which comprise stakes in 14 licenses, three operated, to MOL for an initial US$60 million and potentially an additional $30 million in bonus payments.
MOL says the move is a first step into the Norwegian offshore, with the firm targeting additional assets and licenses, with a view to becoming an operator.
According to MOL, the licenses provide an oil weighted exploration portfolio with net unrisked best estimate Prospective Resources of more than 600 MMboe. The committed work program on the licenses includes three exploration wells in 2015-2016.
The assets are stakes ranging from 8% to 50% across the Norwegian sector of the North Sea and the Norwegian Sea.
MOL says: “The transaction provides an excellent starting point for MOL to enter Norway, to extend its presence in the North Sea region and enhance its international exploration portfolio. MOL’s target is to further extend its portfolio in Norway and add additional assets and licenses to IPN. IPN is pre-qualified as operator in Norway and the acquisition of the company will help MOL in achieving its ultimate goal to become a well-reputed offshore operator in the region.”
Ithaca’s Norwegian assets were acquired when the firm bought Valiant Petroleum in 2013. Les Thomas, Ithaca’s CEO, said: “The team has done an excellent job in restructuring the Norwegian business following its acquisition as part of the Valiant transaction in 2013. The sale provides Ithaca with the right opportunity to now monetize the value of this non-core part of the company while retaining upside exposure to the anticipated drilling program over the next two years.”
Alexander Dodds, Group Executive Vice President for Upstream commented: “Entering Norway as one of the most investor friendly countries is an important milestone in our exploration and production strategy. It enhances our positions in the lower risk offshore North Sea area where we are in the process of building a new production hub and know-how center along the whole exploration and production value chain that should serve as a solid basis to our long term goals in the region.”
The deal between Ithaca and MOL is expected to complete in 3Q 2015.
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