In order to sell its Norwegian oil and gas fields, Shell (NYSE:SHEL) had discussions with Harbour Energy (OTCPK:PMOIF) last year, but the two parties were unable to come to an agreement because of the erratic gas prices and the lack of clarity surrounding the long-term outlook, according to a report from Reuters on Tuesday.
At the end of 2022, negotiations with the biggest British North Sea producer reportedly moved to a new stage. This happened around the same time Russia’s invasion of Ukraine cemented Norway’s position as Europe’s top natural gas supplier.
After the government put a 35% windfall tax on oil and gas producers, bringing the total tax rate to 75%, Linda Cook, the CEO of Harbour Energy (OTCPK:PMOIF), wants to expand the company’s operations outside of the British North Sea. Shell has said that it wants to focus its oil and gas operations on basins around the world that are newer and more productive.
Shell controlled interests in 21 Norwegian oil and gas production licenses as of the end of 2021, including a 17.8% stake in the Ormen Lange gas field, a 45% share in the Knarr field, and an 8.1% stake in the Troll oil field,
Shell Stock and Performance Outlook
In 2021, Norway made 13.4K boe/day and 490M scf/day, which was about 7% of the company’s total gas output. The world’s leading energy corporations seem to be withdrawing from the North Sea. Both Harbour Energy and Shell opted out of commenting. By 1145 GMT, Harbour Energy’s stock had increased by 2.5%, while Shell’s had barely changed.
The last two major oil companies to run offshore fields in Norway are ConocoPhillips and Shell, while TotalEnergies solely holds shares in unoperated projects.
Featured Image: Unsplash @ Krzysztof Hepner