Equinor has reached an agreement with Lundin Petroleum to sell around 54.5 million shares in Lundin - corresponding to a 16% stake in the company - at a price of SEK 266.4 per share, i.e. a total consideration of SEK 14.5bn (around €1.37bn, i.e. over US$1.5bn). Equinor will acquire a 2.6% direct ownership in the Johan Sverdrup oil field, a giant field development that the group is operating in the North Sea for US$910m (over €810m).
Johan Sverdrup is the largest field development on the Norwegian continental shelf (NCS) since the 1980s, with resources estimated at 2.1-3.1 Gboe. It is developed by Equinor (40%, operator), Lundin (22.6%), Petoro (17.4%), Aker BP (11.6%) and Total (8.4%). The first phase worth NOK 86bn (€8.8bn) is 90% complete and is expected to begin production in November 2019. The second phase of the development, worth NOK 41bn (€4.2bn), will include the construction of a new processing platform (P2), modifications of the riser platform, and five subsea systems. Oil production from the second phase is expected to start up in the fourth quarter of 2022. Phase 2 will increase the field production from 440,000 bbl/d to 660,000 bbl/d, for a break-even price below US$20/bbl.
The Johan Sverdrup transaction includes a contingent payment of up to US$52m payable to Lundin in 2025 if Johan Sverdrup reserves near or exceed 2.2 – 3.2 Gboe. Upon completion of the transactions, Equinor will have a 42.6% share in the Johan Sverdrup field and will own a 4.9% shareholding in Lundin Petroleum.