Page 15 - EurOil Week 33

EurOil INVESTMENT EurOil

Shell seeks sale of Norway’s Gasnor

NORWAY ROYAL Dutch Shell is reportedly in talks to sell Shell took over Gasnor in 2012, paying
Norway-based gas business Gasnor, with the $74mn for shares in the company that it did not
move forming part of a broader push to offload already own at the time.
non-core assets. Citing sources familiar with the The super-major is a significant player in the
matter, Bloomberg reported on August 20 that LNG industry, and – like a number of other big
Shell had approached infrastructure funds and oil companies – has talked up its efforts to pivot
private equity firms about a deal. increasingly towards low-carbon energy. None-
The super-major has not publicly commented theless, Shell’s non-core LNG assets are potential
Gasnor is expanding on the story. candidates for a sale as it seeks to bounce back
its focus on LNG Gasnor, which is wholly owned by Shell, from the latest industry downturn, which saw
bunkering. started out delivering pipeline gas to its custom- its net profit fall 82% year on year in the second
ers in 1994, and has more recently moved into quarter of 2020, to $638mn.
the small-scale production and sale of LNG from Bloomberg noted that there were signs of
three plants. The company states on its website a “strong” recovery in deal-making activity
that it owns 16 LNG trailers and 22 LNG termi- in the energy sector, after its value had fallen
nals, as well as two LNG vessels, which run on by more than a third y/y in 2020 amid the
the super-chilled fuel themselves. It has been coronavirus (COVID-19) pandemic. Based
producing LNG since 2003. on its own data, the news service estimates
One of the areas the company highlights its that the value of energy transactions has risen
participation in is LNG bunkering, noting that 93% y/y in the last three months to $139bn.
Norway is a world leader in gas-powered ship- Shell, like other oil companies with assets on
ping. Gasnor says it has developed a concept for the block, will be hoping that this trend will
small-scale LNG and fuel for ships. play in its favour.™

PERFORMANCE

Premier unveils plan to tackle debt

UK UK-BASED Premier Oil unveiled a plan this
week that seeks to help pay down its debt and
alleviate shareholder concerns over the state of
its finances. The announcement came the same
day that the company reported its results for the
first half of 2020.
Under the plan, Premier is seeking to raise
$530mn from its shareholders as part of a
$2.9bn refinancing. Around $300mn of this
will be sourced from new equity in order to pay
down the company’s debt – with $205mn of that
amount being underwritten by creditors that will
convert debt to shares.
Separately, Premier wants to raise $230mn
to fund a proposed purchase of some of BP’s
oilfields in the North Sea. The deal was first their lifespan were also more than halved under
announced in January, when it was set to have the renegotiated agreement.
a price tag of $625mn. However, it was subse- Premier said in its earnings release that its
quently renegotiated in June in the wake of net debt had shrunk to $1.97bn by the end of
the collapse in oil prices, along with a dispute June from $1.99bn at the end of December 2019.
between Premier and creditor Asia Research and Premier’s market capitalisation stood at around
Capital Management (ARCM). $414mn on August 20. The company posted a
Under the renegotiated deal, Premier will $32mn loss after tax before one-off non-cash
only pay $210mn upfront for the BP assets in the charges of $639mn, resulting in a total loss after
Andrew area of the North Sea and its stake in tax of $672mn, down from a $121mn profit after
the Shearwater gas field. A further $115mn will tax in the first half of 2019.
be payable at a later date, but only if crude prices The company’s production in the first half of
recover to above $55 per barrel. Premier’s liabili- 2020 was 67,300 barrels of oil equivalent per day
ties for decommissioning the assets at the end of (boepd), down from 84,100 boepd a year ago.™

Week 33 20•August•2020 www. NEWSBASE .com P15