Faroe Petroleum has completed the sale of its 17.5% working interest in the Fenja development located in PL586 in the Norwegian Sea to Suncor Energy Norge.
Following the sale, Faroe retains a 7.5% working interest in the field.
The cash consideration received by Faroe for the sale of the Fenja interest is $68 million, reflecting the consideration amount of $54.5 million together with working capital adjustments notably capital expenditure incurred since the effective date of January 01, 2018.
Graham Stewart, Faroe Petroleum CEO, said: “I am pleased to announce the completion of the sale of a partial interest in our Fenja project. This transaction validates Faroe’s business model of generating tangible and attractive shareholder returns from our exploration portfolio. As well as producing an immediate cash return, the transaction reduces Faroe’s net capital expenditure on the Fenja development to approximately $96 million. This in turn gives us additional liquidity for our other high quality projects such as the Brasse development and ensures we are fully funded to reach our organic production growth target of 35,000 boepd.
“Faroe remains confident in its potential to exceed this production growth target through additional organic developments and investments, in addition to potential M&A opportunities.”
To remind, the Norwegian Ministry of Petroleum and Energy approved the plan for development and operations for the Fenja field in April this year.
Fenja will be developed with two subsea templates with six wells, three producers, two water injectors and one gas injector, connected to the Njord A platform for processing and storage and export via the Njord B ship.