Equinor has agreed to acquire Shell’s stake in Linnorm, the largest undeveloped gas discovery within the Norwegian continental shelf (NCS).
Shell said the move does not impact its ambitions to “maintain a material upstream position in Norway”.
In June last year, Shell scrapped plans to pursue the Linnorm discovery as a standalone development.
Under the agreement, Equinor will acquire a 30% interest in the licence covering the Linnorm discovery, conditional upon taking over the operatorship from Shell’s Norway arm.
The deal is expected to close during the first quarter of 2024 and is conditional on the approval of the Norwegian authorities.
Proven in 2005, the Linnorm discovery contains around 25-30 billion cubic metres (bcm) of recoverable gas reserves.
Equinor said the Linnorm discovery holds more gas than remaining reserves in each of the Aasta Hansteen, Martin Linge, and Gina Krog producing fields.
The reservoir contains relatively dry gas with high CO2 content which Equinor described as “complex and challenging”.
The Norwegian state-owned firm said its is continuing to explore a tie-back for Linnorm to its Kristin or Åsgard B installations.
Equinor sees “attractive opportunities”
Equinor executive vice president Kjetil Hove said the Norwegian state-owned firm still sees opportunities in the region.
“Through this acquisition Equinor will deepen our position in the Halten area, in line with our strategy to optimise our portfolio on the NCS,” Mr Hove said.
“We know this area well, where we already have producing hubs and still see attractive opportunities.”
Mr Hove said “a lot of good work” has already been done to mature Linnorm, and Equinor will build on this and develop the gas resources for the European market.
Shell managing director in Norway Marianne Olsnes said: “We are proud of our efforts to mature Linnorm and are pleased that we were able to find a solution which opens for it to be developed with an aligned partnership.
“This does not impact our ambition to maintain a material upstream position in Norway and contribute to the development and transition of the Norwegian Continental Shelf.”
If the deal is approved Equinor will hold a 50% stake in Linnorm, with Petoro (30%) and TotalEnergies (20%) each holding a stake.