PGNiG Acquires Duva Field in Norway

Maritime Activity Reports, Inc.

February 2, 2020

Image: PGNiG

Image: PGNiG

PGNiG Upstream Norway, a subsidiary of Polish Oil and Gas Company (PGNiG), has obtained a final administrative consent to purchase additional 10% interests in the PL636 and PL636B licences in the North Sea.

Following the transaction, PGNiG Upstream Norway’s (PUN) interests in both licences increased to 30%. As a result, the volume of Duva field gas production attributable to the Company will rise to 0.2 bcm per year.

“Acquisition of fields on the Norwegian Continental Shelf is one of the investment priorities of the PGNiG Group. Our aim is to ensure that as much as possible of the gas that will flow from Norway to Poland following the launch of the Baltic Pipe will come from our own production. This is part of our strategy to diversify supplies and strengthen Poland's energy security. In this way, we are simultaneously building the position of Polish companies on foreign markets,” said Jerzy Kwieciński, President of the PGNIG Management Board.

The Duva field was discovered in 2016. In June 2019, the Norwegian administration approved the plan for its development and operation. Production is expected to start at the end of 2020 or at the beginning of 2021. Three production wells will be drilled in the field: two producing crude oil and one producing natural gas.

The plan for development and operation also permits the drilling of an additional oil production well. The maximum annual output from the field is expected to reach approximately 30,000 boe in the initial period.

PGNiG Upstream Norway acquired the first 20% interest in the Duva field in July 2019 from Wellesley Petroleum. The agreement to purchase another 10% interest was signed by the Company with Pandion Energy in November 2019. The remaining interest holders in the PL636 and PL636B licences are Neptune Energy Norge (operator), Idemitsu Petroleum Norge, and Sval Energi.

PUN currently holds interests in 29 licences on the Norwegian Continental Shelf. Already this year, the Company has obtained three exploration licences under the annual licensing round organised by the Norwegian Ministry of Petroleum and Energy. In the last three years, thanks to intensified efforts to acquire oil and gas field interests, PUN increased its oil and gas reserves from 80 mboe to approximately 200 mboe.

The Company already produces oil and gas from five fields. Investment and analytical work is underway on another six fields (Skogul, Ærfugl, Duva, Tommeliten Alpha, King Lear and Shrek), with production from the first two fields due to start during the first six months of this year.

An important event for the PGNiG Group in Norway was the drilling in licence area PL838. In autumn 2019, PUN successfully drilled the first well as the operator of that field. The discovered deposit was named Shrek. It is located approximately 5 km from the floating production, storage and offloading unit (FPSO) Skarv, in which PGNiG holds a close to 12% interest. This will make it possible to start production from this deposit in a quick and commercially effective manner.

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