Page 11 - EurOil Week 27 2019

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Equinor cuts stake in Lundin to focus on Johan Sverdrup
NORWAY
NORWAY’S Equinor has expanded its control of the country’s agship Johan Sverdrup oil project, through a swap deal that will see it divest a 16% stake in Sweden’s Lundin Petroleum.
Equinor said in a statement on July 7 it had agreed to lower its share in Lundin from 20.9% to 4.9%, in return for $650mn in cash and a 2.6% interest in Johan Sverdrup, a North Sea giant located 140km west of Stavanger.
At the transaction’s close, scheduled for the fourth quarter, Equinor’s holding at Johan Sver- drup will rise to 42.6%, while Lundin will be le with a 20% share. Other partners in the venture include Norwegian producers Petoro and Aker BP, along with France’s Total.
e deal-making comes ahead of Johan Sver- drup’s scheduled launch this November, nine years a er its discovery. e eld will produce oil at a rate of 440,000 barrels per day at its rst- phase plateau, and 660,000 bpd at its second stage, which it should enter in 2022. Equinor’s
deal with Lundin valued the 2.6% stake in Johan Sverdrup at $910mn, indicating an overall pro- ject value of $35bn.
According to the state-owned company, Lundin will receive an additional $52mn pay- ment if Johan Sverdrup’s resources prove to be at the upper end or higher than the estimated range of 2.2 to 3.2bn barrels of oil equivalent (boe).
Equinor noted that its initial investment in Lundin three years ago carried a weighted cost price of SEK121 ($12.8) per share, while under the new deal it sold the stock back to the com- pany at SEK266.5 per share.
“Since 2016 we have more than doubled the value of our investment in Lundin,” Equinor’s president Eldar Saetre commented. “ is trans- action gives us the opportunity to capitalise on this value creation, and at the same time increase our direct ownership in the Johan Sverdrup eld.” ™
POLICY
Swedish court rejects Vilnius’ appeal in Gazprom suit
LITHUANIA
A court in Sweden has rejected an appeal by Lithuania against a 2016 arbitration ruling in favour of Russia’s Gazprom, drawing a line under an eight-year legal dispute.
According to Gazprom, the Svea Court of Appeal has upheld an earlier verdict by a Stock- holm arbitration tribunal that dismissed Lithu- ania’s €1.5bn ($1.7bn) claim against the Russian gas supplier over alleged unfair pricing policies.
“Today, the Court of Appeal rejected in full the Lithuanian petition to cancel the decision of the Stockholm arbitration court of June 22, 2016, regarding the dispute between Lithuania and Gazprom,” the rm said in a statement. “ ere- fore the conclusions of the Stockholm arbitration court, which rejected all the claims by Lithuania regarding the conditions for the purchase of Rus- sian gas, were con rmed.”
Lithuania filed a suit against Gazprom in 2011, claiming it had been overcharged for gas supplies since 2004. According to Vilnius, Russia initially o ered its gas at a “fair” price but then altered its pricing formula several times result- ing in a dramatic rise in gas rates for consumers.
e Stockholm court said this argument was not su cient grounds for a claim, however, on the basis that a “fair” price was too “abstract” a term to calculate compensation.
“Lithuanian taxpayers, in addition to nanc- ing the costly Lithuanian disputes, will also have to pay court costs incurred by Gazprom,” the Russian company added.
Lithuania’s energy ministry has said it is “ana- lysing the court’s ruling and its motives.”
“And only after getting acquainted with the arguments and motives will we be able to decide whether any processes are possible,” it told the Baltic News Service (BNS) on June 5. “Despite Gazprom’s active resistance, Lithuania has managed to liberalise its natural gas market and ensure favourable supply conditions for consumers.”
Gazprom was forced to relinquish its control over Lithuania’s national gas grid operator in June 2014 under EU unbundling requirements. Later that year the Baltic state diversi ed its gas supplies with the launch of a 4bn cubic metre per year LNG import terminal in Klaipeda.™
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