Lundin Petroleum AB has announced that Lundin Petroleum and its wholly owned subsidiary Lundin Norway AS have entered into agreements with Statoil ASA and its wholly owned subsidiary Statoil Petroleum AS under which Lundin Norway will acquire Statoil Norway's entire 15% interest in the Edvard Grieg field in PL338, offshore Norway and all associated assets including a nine percent interest in the Edvard Grieg oil pipeline and a six% interest in the Utsira High gas pipeline. The effective date of the acquisition of these assets is 1 January 2016.
In consideration for the acquisition of the assets, Lundin Petroleum has agreed to issue to Statoil 27,580,806 new shares of Lundin Petroleum (the Consideration Shares) based upon an agreed average share price of SEK 138 per share and a SEK/USD exchange rate of 8.098. In addition, Lundin Petroleum will transfer 2,000,000 shares held in treasury (the Treasury Shares) and issue 1,735,309 new shares (the New Shares) to Statoil in exchange for a cash consideration based upon a share price of SEK 145.66 per share (the ten day volume weighted average closing share price prior to and including the date of signing). Statoil currently owns approximately 37.1 million shares of Lundin Petroleum, representing 11.93% of the current issued and outstanding shares of Lundin Petroleum. Following completion of the transaction, including issuance of the Consideration Shares and New Shares and the transfer of the Treasury Shares, Statoil will own approximately 68.4 million shares of Lundin Petroleum, representing 20.1% of the then issued and outstanding shares of Lundin Petroleum. Following the transaction Lundin Petroleum will have 340,386,445 shares outstanding.
For Lundin Petroleum this transaction secures access to additional high quality reserves, production and cash flow in the Utsira High core area. Following this transaction, Lundin Petroleum's platform to grow and mature its resource base becomes stronger than ever allowing the company to continue maximising value for all of our stakeholders. Following the transaction, Statoil will further increase their indirect exposure to world class assets such as Edvard Grieg, Johan Sverdrup and an industry leading exploration portfolio. As a consequence of the transaction, Statoil will equity account their interest in Lundin Petroleum.
The two companies will continue to operate independently, and act as separate entities in all licences on the NCS. Statoil remains supportive of Lundin Petroleum's management, its Board of Directors and strategy.
Alex Schneiter, CEO and President of Lundin Petroleum comments, “I am pleased to say that this transaction was the initiative of Lundin Petroleum. We saw a unique win-win opportunity to acquire a direct interest in a world class asset such as Edvard Grieg for an increased shareholding in Lundin Petroleum by Statoil. Increasing our resource base, production and cash flow at the bottom of the cycle will, in my view, lead to Lundin Petroleum emerging stronger than ever as an independent company, and continue to build upon the transformational growth already well under way, creating greater sustainable long term value for our shareholders in the process.”
The transaction remains subject to customary approval of the Norwegian government authorities.