Why is Dong Energy Offloading Oil and Gas?

From Denmark's national oil and gas company to a global leader in offshore wind energy, the past few years have seen Dong Energy enjoy wild success. Now, the clean energy giant is selling up its £1.5 billion oil and gas arm, with the intention of refocussing its efforts exclusively on wind. The move sees the Danish state-controlled company join a host of other North Sea oil and gas companies selling off assets, with many attempting to evade falling crude prices.

So why has Dong Energy decided to shun non-renewables in favour of wind? While currently oil and gas are its biggest cash cows, analysts expect to see wind energy account for 80% of its profits by 2020. In response, the company intends to nurture its wind energy division, and focus all efforts and resources on its renewable energy projects.

Brexit vote triggers investor delays

Unfortunately for Dong Energy the Brexit decision has thrown a fiscal spanner in the works, with representatives confirming that the drastic fall in the value of the pound has delayed plans to sell down 50% stakes in its Norfolk’s Race Bank offshore wind farm. Finding investors is proving difficult, with Henrik Poulsen, Dong Energy’s CEO commenting, "Brexit caused a delay to the Race Bank process as we had to just step back and realign on the impact on the currency with the potential buyers of half of the asset."

Dong farewells fossil fuels

In the meantime, Dong Energy is attempting to sell off its entire fossil fuels division. This includes major oil and gas production assets in the Norwegian North Sea, as well as a 20% stake in Shetland’s £3.5 billion Laggan Tormore gas field.

Ideally, the company is on the search for a single buyer, with Poulsen admitting "We would prefer to have one transaction with all assets included so that is what we are targeting."

A competitive market

Unfortunately, market conditions aren’t ideal. In a bid to survive the oil price crash, even giants like Royal Dutch Shell are putting UK North Sea assets on the market. On the upside, Poulsen maintains that its assets are high value, and that Dong Energy isn’t under any pressure to sell by a looming deadline.

While Dong Energy is selling off its interests in the oil and gas market, others are still working tirelessly to improve efficiency. ‘ASTM Method D5769: An Easy Solution for Determination of High Concentration Aromatic Compounds in Finished Gasolines’ spotlights the latest methods being used to determine benzene, toluene, and total aromatics in finished gasolines, and how mass spectrometer technology is helping refiners avoid saturation of the ion source.