Equinor raises $1 billion selling North Sea fields as oil surges

(Bloomberg) — Equinor ASA sold assets in the North Sea for $1 billion as it seeks to benefit from high oil prices and redirect proceeds to other core businesses. 

Norway’s largest energy company offloaded its entire share in the Greater Ekofisk Area and a 19% stake in the Martin Linge field to Sval Energi, Equinor said in a statement Tuesday. There will also be contingent payments linked to realized oil and gas prices for both assets for 2022 and 2023.

Oil prices have surged this year after Russia’s invasion of Ukraine and the emergence from the coronavirus pandemic, pushing up valuations of producing assets. The deal comes after Equinor boosted dividend payments to shareholders and increased share buybacks following strong cash flows in the past two quarters.

Equinor will retain a 51% ownership share in Martin Linge and continue as the operator. The agreement also includes Equinor’s 18.5% interest in Norpipe Oil AS, part of the infrastructure transporting oil from the offshore Greater Ekofisk Area to land.

“The Greater Ekofisk Area is an area where Equinor has limited participation, and we have therefore decided to sell our position in the area during a period of high prices and to redirect capital to other core areas for the business,” Rune Nedregaard, Equinor’s head of exploration production for south Norway, said in the statement.

The transaction is subject to customary government and license approvals and is expected to be completed during the second half of the year.