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Aker BP has closed the $14bn cash and stock deal to acquire Lundin Energy’s oil and gas business, creating an exploration and production (E&P) company purely focused on the Norwegian Continental Shelf (NCS).

The merged entity is said to hold a ‘world class’ asset base, with low operating costs, low carbon emissions, and increased and sustainable dividends.

As part of the merger deal signed earlier this year, shareholders of Lundin Energy’s E&P business will receive $2.22bn in cash, and over 271.9 million Aker BP shares for each share held.

The shareholders will also retain their stake in Lundin Energy’s renewables focused business.

Effective from 1 July 2022, Lundin Energy Norway will operate as Aker BP’s fully owned subsidiary. The name of this subsidiary will be changed to ABP Norway AS.

Aker BP CEO Karl Johnny Hersvik said: “Our ambition is to create the world’s best oil and gas company with low costs, low emissions, profitable growth, and attractive dividends. We will also play an important role in the global energy transition.”

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By GlobalData

Lundin plans to change the renewables business name to Orrön Energy AB (Orrön Energy), effective from 1 July 2022.

Upon the closing of the transaction, Lundin Energy shareholders will own a 43% stake in Aker BP.

Lundin Energy president and CEO Nick Walker said: “Value creation is at the heart of our business and this combination is a unique opportunity to create a world-leading E&P company, with significant scale, production growth, and strong free cashflow generation into the next decade.

“Coupled with that is a business with industry leading low costs and low carbon emissions.”

Aker BP unveiled plans to invest over Nkr150bn ($15.1bn) in the period leading up to 2030 to develop projects.

During this time, the firm will also drill approximately 180 new wells and undertake exploration programmes.