Oil major BP Plc will pay Total SA $991 million in cash for its French rival's holdings in two oil fields in the Norwegian North Sea as it continues an acquisition spree and Total sheds non-core assets. The world's third-largest Western oil major by market value has agreed to buy a 15.7 percent interest in Valhall and a 25 percent interest in Hod, both located in the southern part of the Norwegian continental shelf, the companies said on Tuesday.
Total said the sale of these "non-strategic" holdings was part of an ongoing optimization of its "upstream assets," referring to its exploration and production business.
For BP, this marks the latest in a string of acquisitions in recent months after it agreed to pay Devon Energy $7 billion for assets in Brazil, Azerbaijan and the Gulf of Mexico.
The London-based company also said last month it would pay $900 million for a 75 percent stake in the oil sands assets of unlisted Canadian company Value Creation.
Total has been present in Norway since the late 1960s and holds interests in 77 licenses there, operating 15. Its main asset is a 39.9 percent interest in the Ekofisk field in the North Sea, Total said in a statement.
Norway accounted for 15 percent of Total's overall production in 2009, making it the biggest contributor to the group's output.
"In terms of reserves, Total currently has the second-largest position of the oil companies in Norway," Total said. "In the coming years, the group will maintain its level of investment to fully value its oil and gas resources in Norway."
Valhall was discovered in 1975 and started producing oil in 1982. Hod was discovered a year earlier but did not start production until 1990, Total said.