BP has announced the creation of a new oil and gas company.

It has signed a deal with Norwegian company Det norske to create Aker BP.

The new firm will combine the assets and expertise of both firms’ exploration and production operations in Norway.

The two companies believe it could increase production to more than 250,000 barrels of oil equivalent per day by the early 2020s.

The completion of the transaction, expected by the end of 2016, is subject to customary closing conditions, regulatory review and approval by Det norske shareholders.

Bob Dudley CEO at BP said: “The Norwegian Continental Shelf represents a significant opportunity going forward and we are looking forward to working together with Aker to unlock the long term value of the company through growth and efficient operations.”