DNO Acquires Sval Energi for $450m

Norwegian oil and gas company DNO has made a significant move in the energy sector by acquiring all shares of Sval Energi from private equity firm HitecVision for a cash consideration of $450 million. This strategic acquisition is valued at $1.6 billion based on the enterprise value of the company.

The transaction, expected to be completed by mid-year 2025, will be financed through existing liquidity, including credit facilities, bonds, RBL debt, and offtake-based financing. DNO had $900 million in cash at the end of 2024, with an additional $100 million available under its reserve-based lending facility.

Sval Energi’s assets will complement DNO’s North Sea portfolio, increasing the company’s global net production by two-thirds to approximately 140,000 barrels of oil equivalent per day. The acquisition will also boost proven and probable reserves by 50% to 423 million barrels of oil equivalent.

Strategic Benefits

With the addition of Sval Energi’s assets, DNO’s North Sea production is set to quadruple to around 80,000 barrels of oil equivalent per day. Proven and probable reserves in the North Sea will skyrocket from 48 million barrels of oil equivalent to 189 million barrels (2P) and from 144 million barrels to 246 million barrels (2C).

DNO’s executive chairman, Bijan Mossavar-Rahmani, highlighted the cash generative nature of Sval Energi’s portfolio, which will support the development of recent discoveries in Norway. The acquisition will also strengthen DNO’s presence in core areas on the Norwegian Continental Shelf (NCS), where the company has already made 14 discoveries.

Key Assets and Integration

Sval Energi brings with it a non-operated interest in 16 producing fields offshore Norway, 141 million barrels of net 2P reserves, and 102 million barrels of net 2C resources. The company’s team of 93 employees will be integrated into DNO’s organization, enhancing its operational capabilities.

In 2024, Sval Energi recorded a cash flow from operations of $565 million with a low production cost of just $14 per barrel of oil equivalent. The MLK wind farm is the only asset excluded from the transaction and will not be part of the acquisition.