North Sea’s biggest oil and gas producer, Harbour Energy strikes £9bn deal for German peer

Harbour Energy on Thursday agreed to acquire Wintershall Dea’s non-Russian oil and gas assets in a £9bn share and cash deal with BASF and LetterOne to create one of the world’s largest independent producers.

London-listed Harbour, the largest British North Sea oil and gas producer, has sought to expand beyond the United Kingdom after the government imposed a windfall tax on the sector following the spike in energy prices in 2022, pushing Harbour into a loss in the first half of this year.

Shares in the company jumped 12 per cent after the deal was announced.

The assets being acquired include Wintershall Dea’s upstream assets in Norway, Germany, Denmark, Argentina, Mexico, Egypt, Libya and Algeria, as well as the company’s carbon dioxide capture and storage licences in Europe.

Its Russian assets are excluded, Harbour said. Earlier this week, President Vladimir Putin ordered Wintershall Dea’s stakes in Russian ventures be transferred to new Russian companies.

BASF, a majority shareholder in Wintershall Dea, will own 46.5% of Harbour and will be entitled to nominate two non-executive directors to Harbour’s board as part of the deal.

Harbour will take on $4.9bn (£3.9bn) of existing euro-denominated Wintershall Dea bonds and will pay an additional $2.2bn (£1.7bn) from Wintershall’s cashflow, Harbour said.

The combined group will have production of over 500,000 barrels of oil equivalent per day (boed), mainly from Norway and Argentina.

Harbour, which supplies about 15 per cent of Britain’s domestic oil and gas, was created in 2021 after an all-share merger between Chrysaor and Premier Oil.

The latest deal follows a couple of recent mega-mergers in the US oil and gas sector – Exxon Mobil’s  $60bn (£47bn) deal for Pioneer Natural Resources and Chevron’s $53bn (£42bn) deal for Hess Corp in October.

Reporting by Yadarisa Shabong in Bengaluru. Editing by Pooja Desai and Mark Potter for Reuters.