Wintershall Buys $1.3b of Norwegian Assets from Statoil

German oil and gas firm Wintershall purchased a string of assets from Statoil (STO) on Friday, keeping its reliance on Russia in check and helping the Norwegian firm lower its costs in the Arctic.

Wintershall, a subsidiary of chemicals maker BASF , will buy stakes in four fields off Norway, including the Arctic Aasta Hansteen project, a stake in the 25 billion crown ($3.7 billion) Polarled pipeline, and smaller stakes in four exploration prospects, the firms said.

"With domestic production in Europe, we are strengthening the European supply security," Wintershall Chief Executive Rainer Seele said in a statement.

Europe gets about a quarter of its gas from Russia and escalating conflict over Ukraine has raised concerns over energy security, prompting calls by policy-makers that Europe should cut its reliance of eastern gas imports.

Russia accounted for more than half of Wintershall's oil and gas production last year while European production was at 18 percent and its reserves in Europe accounted for just 13 percent of the total.

The deal also comes at an opportune time for Statoil, which has sold $20 billion worth of assets since 2010, including producing fields, as it looks to raise cash for its long list of developments, like the giant Johan Sverdrup field, which contains up to 2.9 billion barrels of oil equivalents and could cost $18 billion to develop.

Analysts said Statoil got a good price for the assets, but more importantly, it reduced its exposure to a big project, freed cash for other developments and lowered its future investment commitments.

"Aasta Hansteen is a very expensive project and not very profitable," Kjetil Bakken, an analyst at brokerage Carnegie said. "This is a risk adjustment, they have started the project and now they got one more partner."

Statoil shares traded 0.2 percent higher at 0923, ahead of a 0.3 percent fall in the European oil and gas index. BASF shares were up 0.2 percent.

Norway Output up 50 Pct
The deal comes less than two years after Wintershall acquired several producing assets from Statoil and Friday's deal will boost the firm's production in Norway by around 50 percent to 60,000 barrels of oil equivalents per day, equalling about 17 percent of its global output last year.

A Wintershall spokesman said growth in other world regions would lead to Europe's share of Wintershall's global output staying roughly unchanged in the near future even after the Norway deal.

Wintershall also plans to expand its Russian production and earlier this week said it expects to soon close a 2012 non-cash deal with Gazprom, which would give Russia greater access to gas trading and storage in Germany, in exchange for more stakes in Siberian gas fields.

Friday's deal will give Statoil an accounting gain of up to $900 million and reduce its capital expenditure commitments by $1.8 billion through 2020.

Statoil earlier this year cut its capital spending plans and abandoned its 2020 production target, arguing that it needed to save cash and return more to investors. It now plans to keep capital spending steady at $20 billion a year through 2016.

As part of Friday's deal Statoil will sell 24 percent of the Aasta Hansteen gas field and 13.2 percent of Polarled, which will connect the field to the shore.

It is also selling 24 percent of the Asterix field and exiting Vega, selling its 24.5 percent stake, and its 5 percent stake in Gjoea.

(By Balazs Koranyi, Additional reporting by Ludwig Burger, Ole Petter Skonnord and Gwladys Fouche; Editing by Susan Thomas and Elaine Hardcastle)