THE TIMES (UK): BP sells Ormen Lange stake for $1.2bn: “Ormen Lange - located 120 kilometres off the west coast of Norway - was thrust into the spotlight earlier this year when Shell named it among fields where it had overbooked oil and gas reserves. Shell has a 17 per cent stake and partners the development of the field with US giant Exxon Mobil and Norwegian oil and gas groups Petoro, Statoil and Norsk Hydro.” (ShellNews.net) Posted 24 Nov 04

BP today announced a deal to sell its interests in a North Sea gas field and pipeline seen as crucial to the UK’s future energy needs.

The oil giant will offload its 10.3 per cent stake in Ormen Lange - the second largest gas field in Europe - to Danish group Dong for $1.2 billion (£642m).

At the same time, BP is giving up its 10.2 per cent stake in the 1,200-kilometre Langeled pipeline which will pump gas into the UK from Scandinavia.

Langeled will be the longest undersea pipeline of its kind and is viewed as critical to avoiding an energy crisis in the UK as North Sea supplies start to dwindle.

According to industry predictions, the UK will import more gas than it produces by 2006 to meet demand that has more than doubled over the past 10 years.

Ormen Lange - located 120 kilometres off the west coast of Norway - was thrust into the spotlight earlier this year when Shell named it among fields where it had overbooked oil and gas reserves.

Shell has a 17 per cent stake and partners the development of the field with US giant Exxon Mobil and Norwegian oil and gas groups Petoro, Statoil and Norsk Hydro.

Oil and gas groups were first alerted to the fact that BP was seeking to sell its interests in the project last month.

BP said it wanted to exit the development because it did not have full control and preferred to channel its resources into projects of strategic importance.

Today’s deal will impact BP’s reserves as Ormen Lange was included in its accounts for the first time in 2003.

Production is expected to reach 67 million cubic metres of gas by October 2007, meaning Dong will have approximately 10 per cent of this output at its disposal.

There is enough oil and gas in the field to ensure production until at least 2040. The reserves correspond to Denmark’s entire gas consumption for 10 years.

Dong, based at Horsholm in Denmark, is a state-owned oil and gas group with more than 1.000 employees in Scandinavia and the UK.