British energy supplier Centrica has agreed to sell the Norwegian oil and gas exploration and production business of its 69% owned subsidiary Spirit Energy to Sval Energi. Spirit Energy’s business at Norway’s Statfjord field will be sold to subsidiaries of Equinor. The deals will be effective as of January 1 with headline consideration of $1.08 billion (around 800 million pounds) in cash on a debt free, cash free basis, plus a deferred commodity price linked contingent payment. Centrica, whose 69% share of proceeds is expected to be worth around 560 million pounds, said the deal is aligned with its strategy to “reduce exposure to carbon intensive oil and gas exploration and production”.
The sales result in a 92% reduction in the Spirit Energy Group’s oil and liquids reserves and a 38% reduction of its gas reserves and represent a significant step towards Centrica delivering on its strategy to decarbonize its portfolio and reduce its exposure to oil and gas production. Sval Energi said that the acquisition, which is the largest on the Norwegian Continental Shelf (NCS) since 2019, is expected to be completed in the second quarter of 2022.