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BW Offshore aims to establish BW Energy as separate E&P company

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Oilfield Technology,

BW Offshore has announced it plans to establish BW Energy as a separate E&P company and will invite external investors into the company to finance development of the recently acquired Maromba field offshore Brazil and value-enhancing investments at the Dussafu Marin Permit offshore Gabon.

BW Energy will have a diversified portfolio of production and development assets, positioned for growth based on its unique low-risk development strategy supported by BWO's existing FPSOs, track-record and experience. BW Energy was established in late 2016 and has since developed a portfolio of upstream oil and gas assets in West Africa and Brazil.

"With BW Energy, we have demonstrated our unique ability to move the threshold for commercial development of discovered resources through use of existing FPSOs, fast-track project execution and properly scaled development concepts," said Carl K. Arnet, CEO of BW Offshore. "We will continue to target robust business opportunities based on proven reserves with sequential growth potential and unlock significant value that traditional oil & gas companies are not addressing."

"We have proven the attractiveness of our field development strategy with the Dussafu development. Our E&P activities now have a scale where it is natural to invite external investors to add to BW Energy's project execution capacity and growth potential," Arnet added.

BW Energy will consist of:

  • 73.5% working interest (WI) in the Dussafu Marin Permit offshore Gabon (owned by the current partnership).
  • 56% WI in the Kudu license offshore Namibia (owned by a subsidiary of BWO).
  • 100% WI in the Maromba field offshore Brazil (owned by a subsidiary of BWO, subject to regulatory approval).

BW Energy has as operator of the Dussafu license generated significant value by moving the project from acquisition, through field development sanctioning and to successful production in only 18 months at substantially reduced cost.

Current gross production from the Dussafu field is around 12 000 bpd, expected to achieve approximately 20 000 bpd in 2020 as the 4 new production wells of the phase 2 development are hooked up to the FPSO. The internal estimated recoverable reserves now stands at 80 million boe gross including both Tortue and the Ruche discoveries, up more than 5 times from the sanctioning of the first phase. In addition, a rich inventory of exploration and appraisal opportunities represents further material upside potential.

BW Energy has assembled an experienced E&P organisation, with strong technical and operational capabilities. Following several operational achievements at Dussafu, BWO plans to expand BW Energy's portfolio by transferring its rights to interests in the Maromba field offshore Brazil. Following the transfer, BW Energy will start preparations for the phased development of the Maromba heavy oil discovery which is expected to yield between 100 and 150 MMboe. BWO will also transfer its interest in the Kudu license in Namibia to BW Energy. All of BWO's and BW Group's upstream oil & gas assets will be held through BW Energy following these transfers.

BW Energy will be led by a management team consisting of CEO Carl K. Arnet, COO Lin G. Espey and CFO Knut R. Sæthre with effect from 1 July 2019. BWO and BW Group will invite external investors to invest directly in the new entity. BW Energy targets a listing on Oslo Stock Exchange in 2019 and has retained DNB Markets and Pareto Securities as financial advisers in this respect.

To introduce BW Energy, the company's management will host investor presentations in due course. The company will provide further updates as appropriate.

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