Norwegian Energy Company (OSE:NOR) Noreco has agreed to sell its interests in the Siri field in Denmark to DONG Energy. Noreco has 50 percent interest in license 6/95 in the Danish part of North Sea. Noreco’s share of the recoverable oil reserves in the Siri field was 5.8 million barrels at the end of last year. The price is 13 million USD effective from July 1st 2011.
DONG Energy will take on the repair costs on the cracks in parts of the platform's subsea structure in full. Those costs are estimated to be approximately 2 billion DKK (385 million USD), so Noreco should be spared of a near 200 million USD cost incurring. DONG energy is majority owned by the Danish government.
Noreco has the right to sell the interest to other parties at a higher price until the end of August. Noreco's ownership in Siri's satellite fields Nini East, Nini and Cecilie remains unchanged and unaffected. If completed, the divestment will have a negative result impact of around 60 million USD on Noreco’s Q3 results. The company will continue to improve its long term financing and will consider further divestments. Noreco is trading up 11% heading into afternoon session.
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