Norwegian energy giant Equinor has agreed to buy into one of the UK North Sea’s largest undeveloped oil fields.
Equinor will buy US oil major Chevron’s 40% operated interest in the Rosebank project, which is targeting 300 million barrels of oil.
Chevron confirmed last week that it had received a bid from an unspecified oil company for its stake in Rosebank, which was discovered in 2004 and lies about 80 miles north-west of Shetland.
Analysts said majors with interests in the west of Shetland basin would be among the candidates.
But they disagreed whether private-equity companies would be able to finance an acquisition and pay for the subsequent field development.
Energy consultancy Wood Mackenzie said it would cost about £4.5 billion to develop Rosebank with an FPSO and up to 20 production wells.
Equinor and Chevron said they would not to disclose the commercial terms of the agreement.
Hedda Felin, Equinor’s senior vice president for UK & Ireland offshore, said: “With Rosebank, a standalone development in the underexplored west of Shetland region, we strengthen our upstream portfolio, which also includes Mariner, one of the largest investments on the UKCS in over a decade.
“As we have done with other projects in our portfolio, such as Johan Castberg and Bay du Nord, we intend to leverage our experience and competence to create further value in Rosebank, in alignment with the UK Government’s priority of maximising the economic recovery of the UKCS.”
Al Cook, Equinor’s executive vice president for global strategy and business development and UK country manager, said: “We look forward to becoming the operator of the Rosebank project. We have a proven track record of high value field developments across the North Sea and will now be able to deploy this experience on a new project in the UK.
“Today’s agreement allows us to buy back into an asset in which we previously had a participating interest, demonstrating our strategy of creating value through oil price cycles.
“The acquisition of Rosebank complements our portfolio of oil, gas and wind assets in this country, in line with our strategy as a broad energy company. This new investment underlines Equinor’s commitment to be a reliable, secure energy partner for the UK.”
The other partners in the field are Suncor Energy, with 40%, and Siccar Point Energy, on 20%.
More to follow.