PGNiG Norway to Sell Skarv Gas to PGNiG Sales & Trading

PGNiG Norway's gas production stake in the Skarv field, Norway, is set to change hands to PGNiG's sales company, PGNiG Sales & Trading, following an agreement between the two.

Under the terms of the agreement, PGNiG Norway will sell its stake in the gas produced from the Skarv field to PGNiG Sales & Trading (PST) through a ten-year gas contract. PGNiG Norway will begin to sell gas to PST once first production on the Skarv field commences and will gain €1.3 billion from the contact over the ten years. Production from the Skarv field is expected to commence in the fourth quarter of 2014.

The Skarv field in Norway is expected to have massive potential for gas production. Through its 11.9175 per cent stake in the asset, PGNiG Norway holds approximate gas resources of 70.9 million barrels of oil equivalent.

A statement from PGNiG (Poland) today said that tit had based the €1.3 billion value of the contract for gas supply on the forecast volume of gas to be sold during the contract term. It did not specify what volume of gas had been forecast through the deal. Pricing for the gas will be based on European Energy Exchange prices.

BP Norge is the operator of the Skarv field witj a 23.835 stake.  Statoil holds the majority stake in the project with a 36.165 stake while E. ON Ruhrgas Norge holds a  28.0825 per cent stake.