Joseph Bakare
Equinor has closed transactions exiting the upstream businesses in Azerbaijan and Nigeria, with a total estimated consideration of up to USD 2 billion.
After more than 30 years as a business partner in Azerbaijan and Nigeria, transactions leading to Equinor exiting the countries have now been closed on 29 November and 6 December respectively.
“With these exits we realise value and execute on our strategy to focus the international portfolio, and in combination with recent acquisitions and investments in our competitive projects, we seek to sustain long-term production and profitability,” says Philippe Mathieu, executive vice president for international exploration and production in Equinor.
For the divestment of the full portfolio in Azerbaijan, Equinor will receive a total cash consideration of USD 745 million. The value of the transaction in Nigeria amounts to up to USD 1.2 billion, consisting of a purchase price of USD 710 million and the remainder in contingent payments.
“Azerbaijan and Nigeria have been important countries in our international portfolio for decades. Together with partners and suppliers, we have created significant value for Equinor and society at large. I would like to thank them and our employees in Azerbaijan and Nigeria for their great work and dedication over the years and wish our people well in the transition of their professional journey,” Mathieu continues.
The divestments of assets and exits from operations in Azerbaijan and Nigeria were announced in 2023 and are in line with the strategy of optimising the oil and gas portfolio. The exits enable investments to deepen further in countries where Equinor can add the most value and build a more focused and robust international portfolio.
The total equity production from the assets in Azerbaijan and Nigeria has been on average 24,600 and 18,700 barrels of oil per day, respectively, in the first three quarters of 2024. The closing of these transactions will have a positive impact on the cash flow for fourth quarter 2024.
At the capital markets update in February 2024 Equinor stated the expectation to sustain an average cash flow from operations after tax from oil, gas and trading of around USD 20 billion through 2035. The international upstream business is key to deliver on this with expected 50 per cent increase in the cash flow from this segment by 2030