Longboat Energy, an oil and gas exploration and production company with activities in Norway and Malaysia, has agreed to buy interests in producing offshore fields offshore Norway from INPEX Idemitsu.
The company on Monday announced the acquisition of a 4.80% unitized interest in the Statfjord Øst Unit and a 4.32% unitized interest in the Sygna Unit - together the "Statfjord Satellites - for a cash consideration of $12.75 million, with consideration to be fully funded by JAPEX's investment in Longboat Norge.
In addition, Longboat Norge has entered into a decommissioning security agreement with INPEX Idemitsu and will pay a further deferred, post-tax consideration of US$1.75 million in equal stages over the next 18 months, which will be returned to Longboat Norge after the successful decommissioning of the Statfjord Satellites, currently anticipated in the late 2030s. The transaction's effective date is January 1, 2023.
"Longboat Norge will shortly become a joint venture between Longboat Energy and Japan Petroleum Exploration Co., Ltd ("JAPEX") on completion of the investment into Longboat Norge by JAPEX announced on 2 May 2023," Longboat said.
The acquisition represents Longboat's first producing assets.
Longbaot said the acquisition would bring it long-term cash flow, with the fields expected to produce until the late 2030s. Production net to Longboat Norge will be around ~300 boepd.
According to the company, production is anticipated to approximately double in 2024 following a five-well infill drilling program, which is currently underway, and gas-lift installation which is complete.
The acquisition price is equivalent to US$8.2/2P boe, in-line with recent NCS transactions, Longboat siad. Audited 2P reserves of the assets acquired are 1.55 mmboe net to Longboat Norge, of which approximately 77% is oil and NGLs
Longboat expects the payback on the transaction in under two years.
Helge Hammer, Chief Executive of Longboat, said: "We are pleased to announce our first production acquisition in Norway, the next step in realising our growth ambitions on the Norwegian Continental Shelf. The Statfjord Satellites are two high-quality, long-life assets undergoing an exciting and transformative redevelopment led by Equinor.
"Longboat's ability to secure this acquisition through a bilateral negotiation continues to demonstrate the Company's deep relationships in Norway and is an important next step in creating a full cycle E&P company.
"We would also like to thank our new joint venture partner, JAPEX, with whom we have worked in close cooperation to execute this important transaction. The Statfjord Satellites help position the enlarged business for future success and proves the benefits of joint venture concept."
The transaction is subject to the successful carve-out of Statfjord Øst and Sygna from PL 089 and the completion of the investment by JAPEX in Longboat Norge, announced on May 2, 2023. Completion of the acquisition of the Statfjord Satellites is anticipated prior to the end of 2023.
The assets
Statfjord Øst is located seven kilometers to the northeast of the Statfjord field in a maximum water depth of 190 meters. Statfjord Øst produces oil and gas from good quality, Middle Jurassic sandstone in the Brent Group.
Statfjord Øst began production in 1994 from two subsea production templates and one water injection template tied-back to the Statfjord C platform.
The Ministry of Petroleum and Energy approved a redevelopment plan in 2021 to drill five new production wells into potentially undrained areas of the field while also adding gas-lift to increase production levels.
This in-fill drilling program is currently underway and anticipated to last until the end of 2023 and result in a material uplift to production in 2024. The field is currently anticipated to produce until the late 2030s.
In the period to April 30, 2023, Statfjord Øst had gross production of ~5,200 boepd from one well, equivalent to ~250 boepd net to the acquired INPEX Idemitsu working interest.
The Statfjord Øst Unit partners are Equinor Energy AS (43.25%, op), Petoro AS (30.00%), Vår Energi ASA (20.55%), INPEX Idemitsu Norge AS (4.80%) and Wintershall Dea Norge AS (1.40%).
The Sygna field is located just northeast of the Statfjord Nord field in 300 meters water depth. Sygna produces oil and gas from good quality, Middle Jurassic sandstone in the Brent Group. Originally discovered in 1996, the field began production in 2000 from three production wells tied-back via a subsea template to the Statfjord C facility. A long-reach water injection well was also drilled from the Statfjord Nord template. The field is currently anticipated to produce until the early 2030s.
In the period to 30 April 2023, Sygna had gross production of ~1,300 boepd from one well, equivalent to ~60 boepd net to the acquired INPEX Idemitsu working interest.
The Sygna Unit partners are Equinor Energy AS (43.425%, op), Petoro AS (30.00%), Vår Energi ASA (20.995%), INPEX Idemitsu Norge AS (4.32%) and Wintershall Dea Norge AS (1.26%).
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