DNO could be London-bound after Kurdish
By Robin Pagnamenta: Energy Editor
September 30, 2009
Norway,— DNO, the Norwegian oil
explorer, is considering moving its listing to
London after a row with the Oslo Stock Exchange over
the release of information that has damaged its
business in Iraqi Kurdistan region.
Iraq’s Kurdistan Regional Government (KRG) last week
suspended DNO’s activities in the semi-autonomous
province for six weeks and threatened to expel it
permanently after the Oslo exchange published
details of a $30 million 2008 share deal between the
KRG and DNO.
DNO’s share price fell by 50 per cent the day after
the announcement, which the KRG said had caused
“unjustifiable and incalculable” damage to its
Helge Eide, chief executive of DNO, which has
threatened to sue the Oslo exchange, told The Times
that it was accelerating plans for a new listing,
with London the “most likely alternative... We are
looking at a number of options at the moment and
London is quite an obvious alternative ... although
we have not yet taken a final decision.”
DNO’s market value stood at NKr4.23 billion
yesterday, equivalent to £458 million, although
immediately before the dispute it had been closer to
£700 million. Mr Helge said that DNO might close its
Oslo listing or consider a dual listing.
The dispute centres on a Norwegian regulatory
investigation into the sale of 5 per cent, or 44
million shares, of DNO last October. The stake
subsequently was bought by Genel Energy,www.ekurd.neta
Turkish company that is in the process of merging
with Heritage Oil, a London-listed oil business
active in Kurdish Iraq.
Norwegian press reports have claimed that Ashti
Hawrami, the Kurdish Natural Resources Minister, had
acted as a middleman in the deal and that he
personally or the KRG may have benefited from it
DNO and the KRG claim that the Oslo exchange acted
unlawfully by publishing confidential information.
The exchange argues that it was obliged to release
the details under Norwegian law.
The dispute has highlighted the political risks of
doing business in Iraq, although yesterday there
were fresh signs that the impasse might be easing.
Mr Eide said that a meeting in Oslo on Monday
between officials from the KRG and the Oslo Stock
Exchange had been “positive”. He said: “We hope to
resolve this as quickly as possible and are working
for a positive solution.”
DNO has been working hard to overturn the
suspension, which includes a ban on its existing
Iraqi oil exports of 45,000 barrels per day from the
UK-listed companies already operating in the region,
including Heritage Oil, stand to gain if DNO is
expelled by the KRG permanently, analysts said.
The KRG has said that it bought the DNO shares on
behalf of Genel to support both companies at a time
when financing was difficult and they were not
allowed to export oil from Iraq.
This year DNO became the first foreign oil producer
to be granted an export licence from Iraq. It
started shipments in June.
In 2004, it was the first foreign oil producer to be
granted an oil drilling licence by the authorities
in Iraq since the toppling of Saddam Hussein. It
also has interests in oilfields in the North Sea,
Yemen, East and West Africa.
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