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Norway's Statoil and Norsk Hydro finalise merger plan
AFP
OSLO
Petroleumworld.com 03 14 07The boards of Norwegian oil company Statoil and Norsk Hydro on Tuesday backed the plan for Statoil to absorb Norsk's oil and gas business in a 23-billion-euro agreed late last year.
"Hydro's shareholders will own 32.7 percent and Statoil's shareholders will own 67.3 percent of the merged company," Statoil said in a statement announcing completion of the merger plan.
The deal creates the world's biggest offshore oil and gas producer, far ahead of Anglo-Dutch Shell, Brazil's Petrobras and Britain's BP. The world's overall biggest oil and gas producer, with both land and offshore operations, is ExxonMobil of the United States.
The new company will have a combined production of 1.9 million barrels per day in 2007 and 31,000 employees, the companies said previously.
Norway is the world's third largest oil exporter, behind Russia and Saudi Arabia.
But as oil resources have gradually depleted on the Norwegian continental shelf, Statoil and Norsk Hydro have increasingly turned to the international oil and gas scene to be able to continue to operate as independent companies.
A recent decision by Russian gas giant Gazprom to exclude foreign oil companies from the development of the Shtokman gas field in the Barents Sea, one of the world's few giant untapped reserves, was seen as a serious blow to the two groups.
Both had been seen as well-placed to become partners in the project.
The merger is expected to solve the groups' size problems: the new entity will be present in close to 40 countries and will have proven oil and gas reserves of 6.3 billion barrels of oil equivalents.
Meanwhile, Norsk Hydro, the world's third largest aluminium company, will continue to operate in the metals sector under its existing name.
AFP 13 1853 GMT 03 07
Copyright© 2007 AFP. All Rights Reserved.
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