London Evening Standard: BP sells stake in 'scandal' gas field: “OIL giant BP has sold its share in a controversial Norwegian gas field, thrown into the spotlight by the reserves scandal at rival Shell, for $1.2bn (£645m.” (ShellNews.net) Posted 25 Nov 04
23 November 2004
OIL giant BP has sold its share in a controversial Norwegian gas field, thrown into the spotlight by the reserves scandal at rival Shell, for $1.2bn (£645m.
Danish energy firm DONG is buying the 10% stake in the huge Ormen Lange project, which is expected to play a pivotal role in supplying the UK market when it comes on line in 2007.
Despite the importance of the field, BP put its share on the market last month citing a lack of influence.
Norway's Norsk Hydro and Shell retain a larger stake.
Analysts said the value BP got from the auction, which attracted interest from Britain's Centrica and BG Group, more than justified the move. Bruce Evers at Investec, said: 'It's quite a punchy price.'
Ormen Lange, named after a famous Viking ship, holds 400bn cubic metres of gas and could eventually supply 15% of our gas needs.
But severe doubts still remain about the way the partners on the project have booked reserves for the field.
Shell sparked concern in March by lowering the amount of proven reserves booked against its entitlement in the project to just 20%, against 60% before the scandal at the group first broke.
BP booked more than 80% of its gas entitlement at Ormen Lange as proven and has resolutely stood by that calculation.
A spokesman today said doubts over how the reserves had been booked played no part in the timing of the sale.
'It's a first-class asset,' he said. 'It just doesn't fit with our strategy.'