The UK government is giving Dea UK and partner LetterOne three to six months for a further change of control for UK North Sea petroleum licenses or they will be revoked.
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RWE Breagh installation. From RWE. |
The Department of Energy & Climate Change (DECC) said that Secretary of State Ed Davey is proposing the revocation of the licenses unless Dea’s partner LetterOne arranges for a further change of control. The decision was taken after a thorough review of all relevant information as well as obtaining cross-government views.
According to DECC, under the terms of the licenses held by Dea UK, Dea UK and LetterOne have three months to make the change, however, Davey has offered to extend this period to six months as he awaits LetterOne’s response to this offer.
In March 2014, Germany’s RWE Aktiengesellschaft conditionally agreed to sell its exploration and production firm subsidiary RWE Dea AG to Russian-backed LetterOne Group in a US$7 billion deal.
LetterOne was founded in 2013 as an investment vehicle, run by the founders of Russia’s Alfa Group, including chairman Mikhail Fridman, and former TNK-BP CEO Jonathan Muir, based on the proceeds of the sale of TNK-BP, a controlling stake in Altimo, and other investments, as well as certain private equity and hedge funds.
In October 2014, RWE said the deal was still moving ahead despite questions over the UK assets involved. The deal came under increased scrutiny in the wake of the Ukrainian crisis that resulted in European and US sanctions against some Russian individuals and activities. At that time, the Financial Times said Davey was “not minded” to provide the letter allowing the British assets to be sold. German authorities had approved the deal.
RWE Dea AG has about 190 licenses or concessions with almost half of them under its operatorship that are located in Ireland, Mauritania, Poland, Suriname, Trinidad & Tobago and Turkmenistan. The company also has facilities, and offices in 14 countries, including production facilities and concessions in Germany, the UK, Norway, Denmark, and Egypt.
In September, RWE Dea was awarded operatorship of two offshore blocks in the Gulf of Suez as part of Egypt’s international bid round, holding 100% interest in the East Ras Fanar Offshore and 50% in the Northwest El Amal concession.
Also in September, RWE said the development of its natural gas project Disouq comprising of seven gas fields in the Egyptian Nile Delta was progressing successfully following another positive appraisal of the North West Khilala (NWK) gas field with the development well NW Khilala-1- 4. NWK is the first field brought into production. RWE Dea also has production facilities under construction in Algeria and Libya.
In 2013, RWE Dea started up the Breagh gas field in the North Sea, the largest field development project under its operatorship in the UK and one of the largest natural gas fields under development in the southern UK North Sea.
Read more:
RWE deal with Russian outfit in doubt
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