OKEA Acquires Repsol’s Stake in the Vette Oil Discovery
OSE-listed OKEA ASA has signed a Sales and Purchase Agreement (SPA) with a wholly-owned subsidiary of international energy major Repsol SA, to acquire its 40% operated interest in exploration license PL 972 in the Norwegian North Sea, which contains the Vette oil discovery. The financial terms of the transaction have not been disclosed.
PL 972 (Blocks 9/1, 17/11, 17/12, and 18/0) covers an area of approximately 1,688 sq. km in the south-eastern North Sea, in water depths of about 110 m. The license is currently in the initial exploration phase and contains the Mackerel and Brisling discoveries in addition to the main Vette oil discovery. The Vette oil discovery (Block 17/12), located south of the Sleipner Øst field, was discovered in 1972 and was proven by well 15/12-21 in 2009. The discovery is currently estimated to hold 30 to 50 million barrels of oil equivalent (MMboe) of recoverable volumes. The other partners in the license include ONE-Dyas Norge AS and Norwegian independent M Vest Energy AS, each holding a 30% working interest.
OKEA stated that it plans to pursue a cost-efficient development of Vette with a concept applicable for production from small discoveries. The Grevling fields, located south-east of PL 972 and also operated by OKEA, is similar in size to the Vette field, and the two fields may jointly constitute a coordinated serial development enabling a satisfactory breakeven cost for both fields.
Trondheim-based OKEA holds a portfolio of upstream interests in the Norwegian Continental Shelf (NCS). Originally backed by the Seacrest Capital Group, the company completed an initial public offering in June, raising gross proceeds of NOK315.0 MM (~USD36.0 MM). Bangchak Corporation PCL, an integrated Thai energy company, is currently OKEA’s largest shareholder with a ~46.3% stake.
“We view Vette as the most likely candidate for a profitable small field standalone development on the NCS which can benefit a common infrastructure with similar size fields, like Grevling. Through this transaction, we continue to increase and diversify our portfolio with the key ambition to develop sub-100 mmboe fields on the NCS,” said OKEA’s CEO, Erik Haugane.
The transaction, which has an effective date of January 1st, 2021, is subject to customary closing conditions, including the receipt of approval from both the license partners and Norway’s Ministry of Petroleum & Energy.