By Nerijus Adomaitis
OSLO, Oct 18 (Reuters) - Norwegian Energy Company (Noreco)plans to acquire offshore assets on Britain'scontinental shelf in 2019, following its purchase of Shell'supstream oil and gas licenses in Denmark, its chairmantold Reuters on Thursday.
The Oslo-listed company on Wednesday announced a $1.9billion deal to acquire Shell's 36.8 percent stake in the DanishUnderground Consortium (DUC), which accounts for 90 percent ofDenmark's petroleum output.
"I think we should be capable of doing something in the UK,hopefully in the first half of 2019, but definitely in 2019,"Noreco Chairman Riulf Rustad told Reuters when asked if thecompany also planned to buy British assets.
Rustad said Noreco was looking for opportunities in Denmarkand Britain because asset prices on the Norwegian continentalshelf (NCS) have been inflated by the country's favourable taxregime, attracting "aggressive" private equity money.
In June, private equity-backed Neptune Energy bought assetsof German gas utility VNG, and in 2017 Point Resources acquiredExxon Mobil operated assets off Norway, among other dealsinvolving private equity money.
"That's not the case in Denmark, that's not the case in theUK, which means that the competition is much less," Rustad said.
"The underlying picture there, however, is the same. Themajors are leaving, and I think it's a good thing. It creates anumber of independents, which have a different approach tothings," he added.
Chevron is set to become the first oil major tocompletely exit the NCS, while others, including Exxon Mobil, BP and Shell, have scaled down theirpresence by selling or merging their assets in the mature regionto focus on new growth opportunities elsewhere.
The NCS, however, is less mature than the Danish or British,raising the probability of making new discoveries or boostingproduction from existing fields, Rustad added.
But he said Noreco saw significant value to take out ofDenmark, beyond what current production profiles showed.
He declined to quantify the potential, but the company'sinvestor presentation showed its production in Denmark couldpotentially rise to 80,000 barrels of oil equivalents per day(boed) by 2023.
In the near term, production from the Shell assets wasexpected to decline to 56,000-58,000 boed in 2018 from 67,000 in2017 due to maintenance, and to fall further towards 30,000 boedin 2021.
Total, which holds 31.2 percent in DUC, agreed on Sept. 25to buy an additional 12 percent stake from Chevron,while state-owned Danish company Nordsofonden has the remaining20 percent.(Editing by Nerijus Adomaitis; Editing by Kirsten Donovan)
BP (BP.)
