RWE to sell oil and gas unit for €5.1bn

German utility RWE said it intends to sell its oil and gas production arm for €5.1 billion (£4.3bn). Russian billionaire Mikhail Fridman’s energy investment vehicle, L1 Energy – which was […]

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By Priyanka Shrestha

German utility RWE said it intends to sell its oil and gas production arm for €5.1 billion (£4.3bn).

Russian billionaire Mikhail Fridman’s energy investment vehicle, L1 Energy – which was founded last year – is to buy the Dea unit, gaining assets in the UK, Germany and the North Sea.

Dea operates in 14 countries around the world and produces oil and gas mainly in the North Sea but explores and develops new fields in other regions, including North Africa, the Caspian and South America. It produced around 4.9 million cubic meters of oil equivalent in 2012.

RWE put Dea up for sale around a year ago in what was said to be an effort to reduce debt as the company struggled with falling profits in its power generation business last year.

L1 Energy said in a statement: “This agreement creates an opportunity for the LetterOne Group to make its first strategic step in entering the oil and gas industry. LetterOne sees DEA as a unique growth platform which combines quality upstream assets and a highly experienced management team.”

RWE said the transaction “will be subject to the approval of the Supervisory Board of and of authorities in several countries”.