DNO has sold its entire gas production over a four-year period from the Norwegian continental shelf to French utility Engie ENGI for an undisclosed sum, the Norwegian company said on Wednesday.

It said the deal had been facilitated by a loan from a U.S. bank as U.S. lenders step up funding to the fossil fuel industry, adding it was in discussions over a similar offtake agreement and related financing facility for its North Sea oil production.

The offtake agreement takes effect from October 1 and covers DNO’s increased gas production after its acquisition of assets from Sval Energi in March, DNO said in a statement.

Sval’s acquisition quadrupled DNO’s North Sea production to about 80,000 barrels of oil equivalent per day, about half of it natural gas.

Engie did not immediately respond to a request for comment.

While DNO did not disclose the volume of the four-year contract with Engie, last year DNO and Sval Energi produced 1.82 bcm of gas from the Norwegian continental shelf.

DNO has entered into a financing facility with an unnamed U.S. bank for up to $500 million, which will be used to repay Sval Energi’s debts and for general corporate purposes.

“We have received strong interest by buyers to prepurchase our enlarged North Sea production,” DNO’s Executive Chairman Bijan Mossavar-Rahmani said in a statement.
Source: Reuters