Norwegian energy company Equinor has signed a deal to acquire Shell’s stake in the Linnorm gas discovery.

The companies did not disclose the financial terms of the transaction.

As per the agreement, Equinor will acquire a 30% stake in and the operatorship of PL 255, which covers the Linnorm discovery, 50km north-west of the Draugen field.

The deal increases Equinor’s stake in Linnorm to 50%.

With estimated recoverable gas resources of 25–30 billion cubic meters (bcm), Linnorm is believed to be the biggest undeveloped gas discovery on the NCS.

This is more gas than the remaining reserves of the producing fields Gina Krog, Martin Linge and Aasta Hansteen combined, Equinor noted.

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By GlobalData

Subject to approval from the Norwegian authorities, the acquisition is expected to complete in the first quarter of 2024.

Currently, the partners in PL 255 are Norske Shell, with a 30% stake and operatorship, Petoro, which owns a 30% stake, and Equinor Energy and TotalEnergies EP Norge, each owning 20%.

Equinor said it will keep assessing a tie-back for Linnorm to the facilities that it operates – Kristin or Åsgard B.

Equinor executive vice-president for exploration and production Norway Kjetil Hove said: “Through this acquisition Equinor will deepen our position in the Halten area, in line with our strategy to optimise our portfolio on the NCS. We know this area well, where we already have producing hubs and still see attractive opportunities.”

Shell managing director in Norway Marianne Olsnes said: “We are proud of our efforts to mature Linnorm and are pleased that we were able to find a solution which opens for it to be developed with an aligned partnership.

“This does not impact our ambition to maintain a material upstream position in Norway and contribute to the development and transition of the NCS.”

Last month, Equinor made a “commercially viable” gas discovery near the Gina Krog oil and gas field.