Sweden-based Lundin Petroleum has agreed to sell its entire interests in two Russian fields to Arawak Energy Russia.

Under the deal, Arawak will acquire Lundin’s stakes in the Sotchemyu-Talyu and North Irael Fields, located in the Komi region.

Lundin owns a 50% stake in each of the two fields, with Arawak holding the remaining 50% and acting as the operator.

Lundin reported aggregate net reserves of 6.1 million barrels of oil equivalent from the two fields as of 31 December 2013.

Net production for the first half of 2014 is projected to be 2,150bpd.

"Net production for the first half of 2014 is projected to be 2,150bpd."

Lundin’s revised 2014 production guidance is between 24,000bpd and 29,000bpd, on the expectation that the transaction is completed in July.

The company said the transaction will incur a non-cash financial expense of $12.5m in the period ending 30 June 2014, in relation to the carrying value of the interests and the related funding loans.

Production comes from Devonian carbonate reservoirs and oil is exported through the nearby Transneft pipeline system, with approximately 60%-65% sold domestically.

Lundin has a balanced portfolio of assets primarily located in Europe and South East Asia.

The company, through its subsidiary Lundin Norway, has recently agreed to sell an additional 15% interest in PL359, which contains the Luno II discovery, to Wintershall Norge.

Lundin made the Luno II discovery in 2013, located in PL359 in the central North Sea sector of the Norwegian Continental Shelf on the south-western flank of the Utsira High approximately 15km south of the Edvard Grieg field.

Energy