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PGNiG Will Increase Gas Production In Norway By Purchasing Fields

PGNiG Will Increase Gas Production In Norway By Purchasing Fields

PGNiG Upstream Norway (PUN), the Norwegian "daughter" of the Polish oil and gas concern PGNiG, will buy shares in two active fields in the North sea from Norske Shell, which will allow the group to increase gas production in Norway, the Polish company said in a press release.

"PGNiG Upstream Norway has signed an agreement with Norske Shell to acquire interests in Kvitebjorn and Valemon, two active fields in the North sea. As a result Of the deal, PGNiG Group's own gas production in Norway will increase to 0.9 billion cubic meters in 2021, which is 45% more than in 2019," the report says.

After the transaction, PGNiG Upstream Norway will receive a 6.45% stake in the Kvitebjorn field and 3.225% in the Valemon field. PUN estimates that the acquisition will gradually increase the average daily production of hydrocarbons by about 30%. The deal requires approval from the Norwegian oil and tax authorities.

Gas from the new fields will be sent to Poland after the launch of the Baltic Pipe gas pipeline, along with the volumes obtained as a result of previous acquisitions of the Norwegian "daughter" PGNiG in 2017-2020.

In particular, in May 2020, PUN bought shares in two fields on the Norwegian continental shelf. The company currently produces oil and gas in seven fields.

Following the transaction, PGNiG Upstream Norway (PUN) will come to hold, as a licence partner, a 6.45% interest in the Kvitebjørn field and a 3.225% in the Valemon field. The company will additionally acquire a stake in the infrastructure used to transport hydrocarbons produced from these fields. According to PUN’s estimates, the acquisition will bring about a step increase in its average daily production of hydrocarbons (both oil and gas), of about 30%.

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