StatoilHydro, Chesapeake to Jointly Explore for Gas

By Paul Dobson and Vibeke Laroi

Nov. 11 (Bloomberg) -- StatoilHydro ASA, Norway's largest oil and gas producer, will pay $3.38 billion in an accord with Chesapeake Energy Corp. to acquire a stake in shale assets and fund drilling, as well as forming an exploration partnership.

As part of the agreement, StatoilHydro will buy a 32.5 percent stake in Chesapeake's Marcellus Shale gas acreage in the U.S. northeast for $1.25 billion, the Stavanger, Norway- based company said today in a statement distributed by Hugin.

StatoilHydro will pay another $2.125 billion to fund 75 percent of Chesapeake's drilling and completion expenditures on the assets from 2009 to 2012, the company said. This requires Chesapeake to ``maintain a significant level of drilling activity,'' it said. The companies are also forming an alliance to explore unconventional natural gas opportunities worldwide.

``I am pleased that we today have made a strategically important move by joining forces with Chesapeake, which is the leading U.S. gas player,'' StatoilHydro Chief Executive Officer Helge Lund said in the statement.

``We are adding significant resources to our portfolio.''

StatoilHydro's equity production from the Marcellus deal is likely to increase to at least 50,000 barrels of oil equivalent a day in 2012 and at least 200,000 barrels after 2020, it said.

The company is increasingly looking to unconventional sources, such as oil sands in Canada and heavy-oil in Venezuela, to stem a decline in production from mature fields on the Norwegian continental shelf.

To contact the reporter on this story: Paul Dobson in London at pdobson2@bloomberg.net