BP's Norwegian division merges with local oil company

The Norwegian division of British oil giant BP has merged with local oil company Det norske to create an independent exploration and production company on Norway's continental shelf (NCS), the companies said on Friday.

BP Norge AS ("BP Norway") and Det norske oljeselskap ASA's ("Det norske") have agreed to merge through a share purchase transaction.

The new company will be renamed Aker BP ASA ("Aker BP"), according to an announcement by Aker ASA ("Aker"), the main shareholder in Det norske with 49.99-percent ownership.

Aker BP will be jointly owned by Aker with a 40 percent stake, BP with 30 percent and other Det norske shareholders with 30 percent, the announcement said.

"We take great pride in the fact that BP has chosen to partner with Aker in transforming Det norske into a leading independent offshore E&P company," Aker's Chairman Kjell Inge Rokke was quoted as saying.

"With this transaction, we provide Det norske with operational strength, a robust capital structure and two solid industrial owners, thereby creating a platform for further growth on the NCS," he said.

The two companies have previously considered creating a large independent exploration and production company, BP said.

"BP and Aker have matured a close collaboration through decades, and we are pleased to take advantage of the industrial expertise of both companies to create a large independent E&P company," said Bob Dudley, group chief executive of BP.

"The Norwegian continental shelf represents a significant opportunity going forward and we are looking forward to working together with Aker to unlock the long-term value of the company through growth and efficient operations," he said.

Aker BP will hold 97 licenses on the Norwegian continental shelf, of which 46 are operated. The combined company will hold an estimated 723 million barrels of oil equivalent reserves. Endit