Picture: ISTOCK
Picture: ISTOCK

Oslo — Chevron is selling its last remaining oil exploration licence in Norway, putting it one step closer to a full retreat from the ageing North Sea basin as it seeks higher returns elsewhere.

Chevron’s activity off Norway has been limited for years, but the decision to relinquish its last asset there again shows its reluctance to bet on mature regions such as Northern Europe. The company is seeking to sell most of its UK fields — it agreed to divest its stake in the Rosebank project to Equinor ASA last week — and offloaded its only asset in Denmark
in September.

Barents Sea

Now Chevron has agreed to transfer its 20% stake in the PL859 licence in the Barents Sea, off Norway’s northern tip, to DNO, according to a September 28 letter from the Norwegian energy ministry obtained by Bloomberg.

The deal, first reported by Upstream, "implies that Chevron Norge shuts down its operations in Norway and leaves the Norwegian shelf permanently", the ministry said in the letter.

Chevron and DNO did not immediately reply to requests for comment.

Chevron has not had any producing assets in Norway since it sold its stake in the Draugen oil field in 2014. Yet when the government opened up a new exploration area bordering Russian waters in 2016, the company secured a stake in the PL859 licence. That permit held the biggest-known remaining prospect off Norway — a rare opportunity to make a gigantic find in the region.

But the prospect — the much-anticipated Korpfjell structure — proved a disappointment in 2017 when operator Equinor made an uncommercial gas discovery.

The Norwegian company has committed to a deeper well on the same prospect, and plans to drill it in 2019.

Chevron is the first oil major to leave Norway altogether, though rivals have also scaled back their presence following strategic reviews prompted by the 2014-2017 industry downturn. Exxon Mobil has sold all its operated assets in the country, while BP merged its local unit with a smaller Norwegian company, and Royal Dutch Shell and Total have divested assets.

Chevron’s disposal of Rosebank came after the company said in July that it is seeking
to sell most of its oil and gas fields off Britain.

Consultant Wood Mackenzie said the transaction could “spell the end for Chevron in the UK and Europe”.