Maersk gets approval for $6.3 billion U.K. North Sea gas field

A.P. Moeller-Maersk container vessels sit in port at Algeciras, Spain.
A.P. Moeller-Maersk container vessels sit in port at Algeciras, Spain.PHOTO: BLOOMBERG

COPENHAGEN (BLOOMBERG) - A.P. Moeller-Maersk A/S won U.K. approval for a US$4.5 billion (S$6.3 billion) development plan for the Culzean natural gas field as the Danish company tries to ramp up output at its energy division.

The field, located in the central part of the British area of the North Sea, is expected to produce enough natural gas to meet 5 per cent of the U.K.'s total demand in 2020 or 2021, Maersk said in a statement on Monday.

Maersk Oil will be the operator of the field with a 49.99 per cent stake, while JX Nippon Oil & Energy Corp. has 34.01 per cent and BP Plc 16 per cent.

Nils Smedegaard Andersen, chief executive officer of the Maersk group, said earlier this month the company is actively searching for North Sea oil acquisitions as the drop in energy prices makes takeovers attractive. The company wants to return focus to its North Sea waters, where it first started operations in the 1960s and where it has a market-leading advantage with its technologies, he said.

"Culzean is the latest in a series of large investments by Maersk Oil in the North Sea where we are active in Denmark, Norway and the U.K., reflecting our commitment to the future of the North Sea region," Jakob Thomasen, CEO of Maersk Oil, said in the statement.

Maersk estimates the Culzean gas condensate field has resources of as much as 300 million barrels of oil equivalent. Production will start in 2019 and continue for at least 13 years, Maersk said.