Statoil sells Shah Deniz stake to Malaysian firm Petronas in $2bn deal

Caitlin Morrison
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STATOIL has exited the Shah Deniz oilfield in Azerbaijan, selling its 15.5 per cent stake to Malaysian oil and gas company Petronas for $2.25bn (£1.4bn).

Norwegian firm Statoil’s withdrawal from Shah Deniz, which is operated by BP, comes into effect from 1 January 2014 for accounting purposes, although the deal is expected to complete in early 2015.

Lars Christian Bacher, Statoil’s head of development and production activities outside Norway, said: “Statoil has created significant value by participating in the development of this asset over the years and we are pleased to announce this deal with Petronas. The divestment optimises our portfolio and strengthens our financial flexibility to prioritise industrial development and high-value growth.”

Bacher added: “We remain committed to our business in Azer­baijan, which continues to play an important role in Statoil’s international portfolio.”

The company is to retain an 8.56 per cent stake in the Azeri-Chirag-Guneshli oil field, which is also operated by BP.

Statoil has been selling assets to combat declining oil prices, in a similar vein to other companies such as French oil operator Total, which sold out of Shah Deniz in May, saying it would focus on operating projects rather than holding minority stakes.

S&P Capital IQ equity research analyst Clive Roberts said Statoil’s divestment would help to streamline the company’­s portfolio and provide more financial flexibility to “deliver on its strategy for high-value growth by prioritising industrial development”.

He added that Statoil was expected “to reinvest the proceeds to avoid the risk of EPS dilution”.