July 6 (Renewables Now) - Norwegian oil and gas group Equinor ASA (NYSE:EQNR), formerly Statoil, has struck a EUR-400-million (USD 468m) deal to take over Danish energy trader Danske Commodities (DC).
Equinor described its target as one of Europe’s largest short-term electricity traders, also providing energy market services. Last year, Danske Commodities traded 318 TWh of electricity across 37 countries along with 389 TWh of gas across 18 countries.
Equinor’s main business is oil and gas exploration and production but it wants to become a broad energy company. For this exact reason the company changed its name and has been expanding into renewables, mostly offshore wind but also solar power. It claims it is a world leader in carbon capture and storage (CCS) and anticipates to invest 15-20% of its capital expenditure in new energy solutions by 2030.
Commenting on the fresh deal, Danske Commodities CEO Henrik Lind said that the Danish firm will have a new owner with “big ambitions in renewables”.
“Under Equinor’s ownership Danske Commodities will benefit from a stronger financial position and a portfolio of gas and renewable assets across Europe that can be optimised in the short-term dynamic market and give us further trading opportunities,” he stated. Lind will continue to lead DC for at least 12 months after the transaction closes.
In turn, Irene Rummelhoff, Equinor’s executive vice president for new energy solutions, commented that the takeover will strengthen the company’s ability to capture value from current and future equity production of renewable electricity.
"We see excellent opportunities to develop our collective understanding of various national markets in a world where renewables to a larger and larger degree will be exposed to market risk,” she added.
The agreement to buy DC includes smaller contingent payments that depend on DC’s performance over the next couple of years. The transaction is awaiting clearance from the European Commission.
(EUR 1.0 = USD 1.171)