Repsol gains control of Eagle Ford JV assets from Equinor

Nov. 18, 2019
Repsol has agreed to acquire and take operatorship of Equinor’s share of onshore Eagle Ford assets held in a joint venture between the companies. Repsol will hold a 100% interest in the asset.

Repsol has agreed to acquire and take operatorship of Equinor’s share of onshore Eagle Ford assets held in a joint venture between the companies. Repsol will hold a 100% interest in the asset.

For total consideration of $325 million, Equinor agreed to divest its 63% interest in the assets, covering 69,000 net acres with 34,000 boe/d of production. Total output for Repsol at Eagle Ford after the agreement will reach 54,000 boe/d.

The transaction, which has an effective date of Oct. 1, enables Equinor to focus capital on core activities in the US, said Torgrim Reitan, executive vice-president for development and production international.

“The US is a core area for Equinor, demonstrated by recent acquisitions including assets in the Gulf of Mexico, onshore acreage in the Austin Chalk, and the Empire Wind project offshore New York,” he said.

Repsol said the agreement allows the company to improve the management of its producing assets portfolio and take advantage of operating synergies that will translate into higher efficiencies. The agreement is included in the company’s upstream 2018-20 planned investment of €8 billion.

Equinor entered the Eagle Ford asset in 2010 through a joint acquisition with Talisman Energy USA (now owned by Repsol) from Enduring Resources (OGJ Online, Dec. 22, 2014). In 2015, Equinor increased its interest in the joint asset from 50% to 63% and assumed full operatorship (OGJ Online, Dec. 21, 2015).

In a separate agreement, Repsol will acquire a 20% non-operated interest in the Equinor-operated Monument prospect in the Gulf of Mexico. The Paleogene Monument prospect is on Walker Ridge Blocks 271 and 272. Drilling contractor Pacific Drilling has said Equinor has arranged for the Pacific Khamsin drillship to work on Monument. Drilling is expected to begin before yearend.

Third-quarter operated production from Equinor’s US assets within onshore unconventional plays and offshore Gulf of Mexico was 430,000 boe.