April 27, 2018 / 1:22 PM / a year ago

RPT-Gas supplier VNG's Norwegian energy unit attracts buyout-backed firms - sources

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LONDON/FRANKFURT, April 27 (Reuters) - German gas supplier VNG is attracting interest from private equity-backed energy firms including Chrysaor and Point Resources for its Norwegian Norge oil and gas business, which could fetch up to $500 million, three sources said.

VNG, which last year hired U.S. investment bank Citi to sell a 51 percent stake in its Norwegian and Danish portfolio, is the latest European utility looking to exit offshore assets on the Norwegian continental shelf, which require heavy investment to develop.

One of the sources said Chrysaor, backed by Harbour Energy, an investment vehicle of EIG Global Energy Partners, and Point Resources, which is majority owned by private equity firm HitecVision, would be joined by petrochemicals firm Ineos, which bought oil and gas business from Dong Energy last year, and two more unidentified bidders at the mid-May auction set by VNG.

Over the past couple of years, private equity-backed buyers such as Neptune Energy, Chrysaor and Siccar Point Energy have snapped up unwanted assets from major energy producers and big utilities.

Chrysaor declined to comment, while a spokeswoman for Point Resources said “our company policy is not to comment speculations in media”. Ineos was not immediately available to comment and VNG Norge did not respond to a request for comment.

Two of the sources familiar with the matter also said firms that had initially shown an interest, including DEA, a vehicle of Russian billionaire Mikhail Fridman which is in the process of merging with Wintershall, and Sweden’s Lundin Petroleum, were unlikely to pursue their interest.

Lundin declined to comment and DEA was not immediately available to comment.

VNG’s portfolio includes the $1.3 billion Fenja development, one of the largest recent North Sea oil discoveries estimated to hold about 100 million barrels of oil equivalents, as well as substantial stakes in four other operated licences and minor stakes in three producing fields off Norway.

VNG is majority-owned by German utility EnBW with a 74.2 percent stake.

Other European utilities that have divested offshore Norwegian assets recently include France’s Engie, which sold its UK and Norwegian North Sea fields, while British utility Centrica combined its North Sea business with Bayerngas Norge, an unlisted arm of German Stadwerke Muenchen and Bayerngas.

Sources told Reuters that Endeavour Energy UK had launched the sale of its North Sea oil and gas assets and Spain’s Repsol was also considering selling its energy portfolio in the region.

$1 = 0.8214 euros Reporting by Arno Schuetze, Ron Bousso and Clara Denina; Additional reporting by Nerijius Adomaitis in Oslo and Christoph Steitz in Frankfurt; Editing by Mark Potter

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