Equinor Acquires 49% Stake in Rosneft's East Siberian Subsidiary
Equinor ASA has entered into an agreement with the Russian state-owned PJSC Rosneft Oil Company to acquire a 49% stake in its wholly-owned subsidiary, LLC KrasGeoNaC (KGN), which is focused on operations in East Siberia.
Under the terms of the agreement, Equinor will acquire the stake in KGN for a total consideration of approximately US$550 million, subject to customary adjustments, including a cash payment of US$325 million. In addition, Equinor will undertake a range of obligations to fund exploration campaigns on KGN’s licenses, and also make certain other payments.
KGN holds interests in 12 E&P licenses for areas with conventional resources in the East Siberian basin, including the Danilovsky (containing the North-Danilovskoye field), Preobrazhensky, Verkhneichersky, Mogdinsky, East-Sugdinsky, Sanarsky license areas. The Danilovsky license commenced production in 2020, while the other license areas are currently in the exploration and appraisal stages.
The North Danilovsky field, located in the Katangsky district of the Irkutsk region, commenced production in July 2020, and is expected to reach 40,000 barrels of oil per day (bbl/d) by 2024, with subsequent plans to further increase it to 70,000 bbl/d.
“As part of this agreement, Equinor has redirected its remaining exploration commitments offshore in the Sea of Okhotsk and as such has no outstanding obligations in that area,” Equinor said in a statement.