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    Neptune to Buy VNG Norge

Summary

UK independent Neptune Energy has agreed to buy VNG Norge, adding to Neptune's existing portfolio of Norwegian upstream assets.

by: Mark Smedley

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NGW News Alert, Natural Gas & LNG News, Europe, Corporate, Mergers & Acquisitions, Exploration & Production, News By Country, Denmark, Norway, United Kingdom

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Neptune to Buy VNG Norge

UK independent Neptune Energy announced June 28 it has agreed to buy VNG Norge, the mostly Norway-based oil and gas producer, from German gas wholesaler VNG.

Neither disclosed purchase price but completion is expected in 4Q2018. Germany's VNG had been looking for a sale since, at least, the start of the year.

VNG Norge has assets in strategic locations including: the Greater Njord Area (with the operated Fenja development asset) and the North Sea/Utsira High area, with a stake in the Ivar Aasen asset. The company has a portfolio of 42 licences, five producing fields, and three development projects including Fenja (30% and operator), Bauge (2.5%) in Norway, and Solsort (13.8%) in Denmark. 
VNG Norge net production for 2017 was an estimated 4,000 boe/d with a significant ramp-up by 2022 as new capacity comes onstream. Net reserves and resources as at 31 December 2017 of over 50 mmboe.
 
Neptune said that VNG Norge "is highly complementary to Neptune’s existing Norwegian portfolio, consolidating its equity position in the greater Njord area with 22.5% in Njord as well as a 30% interest and the operatorship of the Fenja oil development project." Fenja is a subsea development which will be produced as a tie-back to the Njord production hub and is scheduled to come on stream in 2021.

“We are extremely pleased to announce the signing of the SPA to acquire VNG Norge, which provides us with our first acquisition since the completion of our purchase of Engie E&P, and is directly in line with our strategy of consolidating our position in key jurisdictions with high quality and complementary assets," said Neptune's executive chairman Sam Laidlaw.

VNG said the deal is subject to approval by its supervisory board, as well as customary regulatory approvals. "We are now in a position to invest more focused into the development of new business areas such as digital infrastructure, biogas and local energy solutions and to further strengthen our gas infrastructure and gas trading businesses,” said VNG CEO Ulf Heitmuller. The company said its upstream arm had made "a very positive" contribution to VNG, but that it was confident it would thrive under its new owner.

VNG Norge is wholly-owned by VNG, which itself is 74.21% controlled by one of Germany's leading power companies EnBW. 

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