Equinor adds Buzzard to North Sea oil portfolio

Market: Crude oil
03/03/23

Norway's state-controlled Equinor has agreed an $850mn deal to acquire the UK business of Canada's Suncor Energy, giving it a stake in one of the UK's largest producing oil fields and an additional interest in one of the country's biggest undeveloped oil projects.

Suncor's UK portfolio includes a 29.89pc non-operated share in the Buzzard field, the main contributor to the North Sea Forties crude stream and the largest oil field discovered in the UK North Sea in the past 20 years. The field, which is operated by China's state-controlled CNOOC, is currently producing around 60,000 b/d. Equinor said it expects the stake to add around 15,000 b/d to its production this year.

Buzzard came on stream in 2007. A second phase of development started up in late 2021. Involvement in Buzzard will reinforce Equinor's position in the North Sea crude market. The firm is already Norway's largest oil producer and is operator of the 720,000 b/d Johan Sverdrup project, the North Sea's biggest oil field.

The Suncor deal will also give Equinor an additional 40pc interest in the undeveloped Rosebank oil project in the UK's west of Shetlands area, taking its operated stake in the 300mn bl field to 80pc. Equinor said $250mn of the agreed $850mn purchase price is contingent on a final investment decision on Rosebank, which the firm is aiming for at some point this year.

The company's commitment to Rosebank was queried last year when the UK government introduced a windfall tax on oil company profits. Equinor then described claims that it was considering pulling out of the project as "pure speculation".

By James Keates

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