Aker BP has signed an agreement to acquire Hess Norge for $2bn in a bid to strengthen its position in the Norwegian Continental Shelf and improve its production and reserves.

The transaction includes acquisition of Hess Norge’s 64.05% interest in the Valhall field and 62.5% interest in the Hod field and will make Aker BP the sole owner of the two fields.

These two fields produced an average of 26,000boepd a net to Hess over the first six months of this year.

Under the agreement, Aker BP will also assume Hess Norge’s tax positions comprising a tax loss carry forward with a net nominal after-tax value of $1.5bn.

Aker BP chairman Øyvind Eriksen said: “The acquisition of Hess Norge is another move as a part of our ambition to grow the company.

“This investment allows Aker BP to raise the dividend level to $350m per year with first uplift planned for fourth quarter of 2017.”

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The company will finance the transaction from its existing long-term reserve-based lending bank facility and by issuing $500m in new equity.

“This investment allows Aker BP to raise the dividend level to $350m per year with first uplift planned for fourth quarter of 2017.”

The Valhall field centre comprises six separate steel platforms for living quarters, drilling, production, water injection, and a combined process and hotel platform.

Developed with an unmanned wellhead platform, the Hod field is remotely operated from the Valhall field centre. The field is located 13km south of Valhall.

A Plan for Development and Operation is set to be submitted by Aker BP for the Valhall Flank West project this year, with the first oil expected in 2020.

Subject to customary closing conditions, relevant competition clearance as well as Ministry of Oil and Energy and Ministry of Finance approvals, the acquisition is expected to close by the end of this year.

Image: Valhall Field. Photo: © Aker BP.