ExxonMobil contemplating Norway upstream withdrawal

June 25, 2019

Offshore staff

LONDON – ExxonMobil may put up for sale its remaining oil and gas interests offshore Norway, according to a Reuters report.

The company sold its operated stakes in the Balder, Ringhorne and Jotun fields to Point Resources, but has retained its position in more than 20 other fields, including Snorre in the North Sea and Ormen Lange in the Norwegian Sea.

According to a spokesperson from the company, it had decided to open a data room to test market interest in its Norwegian upstream portfolio.

Neivan Boroujerdi, principal analyst, Europe upstream, at Wood Mackenzie, said: “The move doesn’t come as a surprise. We recently highlighted Norway amongst a $48 billion pool of assets from which we think ExxonMobil could meet its recently announced $15 billion divestment target.”

The sale could potentially be Norway’s largest since Statoil’s merger with Norsk Hydro announced in 2006, he added.

“While Norway is no longer core to the overall business, ExxonMobil’s position is substantial enough to receive an attractive exit price, particularly as Norway remains one of the premium M&A markets in the world.

“It’s a highly cash generative business with low operating costs, producing 150,000 boe/d. The portfolio is predominantly operated by Equinor, which has laid out its own plans for increased oil recovery in the coming years – so it will come with future investment opportunities.

“In terms of buyers, the new wave of North Sea independents are likely to be the front runners.”