Norwegian state oil assets

The Norwegian state oil company Statoil ASA will pay the government 38.6 billion kroner (dlrs 4.3 billion) for 15 percent of its holdings in offshore petroleum fields, the oil ministry announced Thursday. "This is Norwegian history's biggest transaction," Oil Minister Olav Akselsen said in announcing the deal. The government already had announced that it would sell 21.5 percent of the its offshore oil interests. It is selling 15 percent to Statoil and the other 6.5 percent to 44-percent state-owned Norsk Hydro ASA and other companies. Norway is the world's second largest oil exporter, after Saudi Arabia. The government controls most of the vast petroleum reserves off the nation's west coast through State's Direct Financial Interest, or SDFI; and through Statoil. Based on the sale price to Statoil, the whole SDFI would currently be worth 257 billion kroner (dlrs 28.5 billion). Parliament last month approved the sale of part of the SDFI to Statoil, Norsk Hydro and other companies and endorsed the sale of up to one-third of Statoil's shares to private investors. The government plans to offer up to 20 percent of Statoil's shares in June. The oil company and the government announced the price, as well as the size and location of stakes being sold, at a joint news conference on Oslo. The price and distribution of shares to the other companies has yet to be announced. Under the agreement, Statoil will purchase a stake in 10 large fields and some smaller ones. Most important is the 6.93 percent stake Statoil is to buy in the Troll field, the largest gas field in Europe. The contract gives Statoil rights to the stakes retroactively from Jan. 1. The company already owns major stakes in most of Norway's offshore petroleum fields. Statoil Chief Executive Olav Fjell said he was satisfied with the price. "We have gotten to buy shares we think can contribute most to increasing values," he said. Norway produces about 3.2 million barrels of oil per day. Under SDFI, the government invests directly in about 150 oil fields, then reaps its share of the profits along the same lines as do other investors. Statoil was founded in 1972 to build the expertise needed to protect the nation of 4.5 million's interests as a new oil producer. It employs about 18,000 people in 23 countries.