Equinor has signed its exit papers from the Bakken with the completion of a sale announced in February to Grayson Mill Energy.
The $900 million divestment of Equinor’s onshore operated and non-operated assets and associated infrastructure was backed by EnCap Investments, a private investment firm. The sale means the company formerly known as Statoil is no longer a Bakken producer. But it will still be buying crude oil from its former Bakken assets. And it will also continue to operate its former Bakken assets for up to four months after the closing date as part of a transition agreement. At the end of that, most of its field staff and support team will transfer to Grayson.
Grayson, meanwhile, is a Houston-based exploration and production company, according to its website, focused on the acquisition and development of oil and gas assets in U.S. unconventional resource plays. It’s being led by a familiar face in the Bakken. Eric Bayes, who was previously vice president of completion and production for Oasis Petroleum and, from 2013 to March 2015, was office manager of the Oasis Petroleum’s Williston office. Bayes worked for Hess in North Dakota before that.
Equinor had 242,000 acres in the Bakken, which produced around 48,000 barrels of oil per day. It entered the state as Statoil, with the then $4.7 billion purchase of Brigham Exploration Company.
Equinor President and Chief Executive officer Anders Opedal said the company was “optimizing” it’s portfolio to make the company more robust in the future.
“By divesting our Bakken position we are realizing proceeds that can be deployed towards more competitive assets in our portfolio, enabling us to deliver increased value creation for our shareholders,” he said. “Over the past few years, we have improved the safety, cost, efficiency, and CO2 intensity of the Bakken assets significantly, and I am confident Grayson Mill Energy will continue on this path.”
The sale follows a 2019 announcement that the company would reduce its net carbon intensity by at least 50 percent by 2050, and grow its renewable portfolio 10-fold by 2026. At the time, still pre-pandemic, company officials told the Williston Herald there was no plan to sell Bakken assets, and that they were pleased with both the improved performance and safety records of the division. Carbon emissions had been reduced by 25,000 tons in 2019 alone.
Equinor’s Bakken sale is not the company’s first North American divestiture. In 2019, it sold operated assets in the Eagle Ford to Repsol for $325 million.
Equinor has faced growing criticism at home in Norway for investments in North America, which have lost billions according to company reports. From 2007 to 2019, Equinor’s accounting loss is listed as $21.5 billion for its U.S. activities, based on a report by accountants PwC. In 2020, it reported an annual net loss of $5.5 billion.
Equinor still has North American assets in the Appalachian Basins in Ohio and Pennsylvania and offshore assets in the US gulf of Mexico. It is also pursuing offshore wind development on the east coast of the United States. It employs 750 people in the United States, including its North American headquarters in Houston, field offices in North Dakota, and other locations.