Statoil buys Hydro’s oil and gas assets

Norwegian companies Hydro and Statoil have agreed a merger of Hydro’s oil and gas activities with Statoil, creating the world’s largest offshore operator in an estimated $28billion deal.

The new company will have a combined production of 1.9 million barrels per day in 2007 and proven oil and gas reserves of 6.3 billion barrels of oil equivalents. Hydro will continue as a global aluminium-focused company.

“By combining forces, the new company will be a highly competent and financially strong Norwegian-based energy champion,” says a joint statement from Jan Reinås and Jannik Lindbæk, chairmen of the board of directors of Hydro and Statoil respectively. “The industry faces an increasingly challenging international landscape. To merge now makes perfect sense.”

Hydro’s shareholders will hold 32.7% and Statoil’s shareholders will hold 67.3 % of the new company, while the Norwegian State will hold approximately 62.5% in the merged entity. Final closing of the deal is expected to be in the third quarter 2007. In the meantime, Hydro and Statoil will be managed as separate companies. A new name for the merged company will be selected as part of the integration process.

“This merger comes at a time when both companies were undervalued,” says Christine Tiscareno, integrated oil & gas analyst at Standard & Poor's Equity Research. “Combining a high potential discovery area (Statoil) with knowledge of data interpretation and exploration expertise in the Gulf of Mexico (Norsk Hydro) is a win-win situation.”

Standard & Poor's Equity Research believes the merger was instigated due to the severe lack of global operating resources in the sector, from materials to equipment and personnel.

Only users who have a paid subscription or are part of a corporate subscription are able to print or copy content.

To access these options, along with all other subscription benefits, please contact info@risk.net or view our subscription options here: http://subscriptions.risk.net/subscribe

You are currently unable to copy this content. Please contact info@risk.net to find out more.

Chartis Energy50 2023

The latest iteration of Chartis' Energy50 2023 ranking and report considers the key issues in today’s energy space, and assesses the vendors operating within it

2021 brings big changes to the carbon market landscape

ZE PowerGroup Inc. explores how newly launched emissions trading systems, recently established task forces, upcoming initiatives and the new US President, Joe Biden, and his administration can further the drive towards tackling the climate crisis

You need to sign in to use this feature. If you don’t have a Risk.net account, please register for a trial.

Sign in
You are currently on corporate access.

To use this feature you will need an individual account. If you have one already please sign in.

Sign in.

Alternatively you can request an individual account here