Noreco, an independent oil and gas company, has entered a deal that will see its Norwegian subsidiary cease all petroleum activities. The company did not reveal financial details of the agreement.
Noreco said on Monday its subsidiary Noreco Norway has entered into a sale and purchase agreement (SPA) with Djerv Energi AS for the sale of its exploration licence interests, organisation and management systems.
The owners of Djerv will be a US based investment fund (70%) and Noreco (30%), said Noreco.
According to the independent oil company, the owners of Djerv will subscribe on equal terms prorata in a primary offering, to ensure that the company is funded for known commitments.
Additionally, Noreco Norway has entered into a sale and purchase agreement to transfer its 4.36% participating interest in the Enoch licence, offshore Norway, to CapeOmega AS.
Subject to completions, the proposed transactions will lead to a subsequent ceasing of all of Noreco Norway’s petroleum activities. Added to the proceeds from the Oselvar sale this is expected to result in an estimated recovery of approximately 90% of the initial principal amount under the NOR06 bond issue, the company said.
Noreco also added that the proposed transactions are conditional upon approvals by the Norwegian ministries; Ministry of Petroleum and Energy and Ministry of Finance. Additionally, the transaction entered into with Djerv is conditional on approval from NOR06 bondholders.