Hess Corporation (HES) yesterday joined hands with Royal Dutch Shell (RDSA) for a strategic asset swap deal. The deal will double Hess’ interest in two offshore fields in Norway – Valhall and Hod ? to 56.18% and 50%, respectively. No cash consideration is involved in the transaction.

The agreement is subject to regulatory approvals and is expected to be completed in the first quarter of 2010.

Under the terms of the agreement, Hess will assume 28.09% and 25% interest in Shell’s Valhall and Hod fields, respectively. In return, Shell will assume Hess’ 9.29% interest in Clair field in UK North Sea and all interests in Gabon Incorporatedluding production fields Rabi Kounga (Hess 10%), Atora (40%) and Toucan (50%) and the Ozigo exploration permit.

This swap deal has a long-term favorable impact on both the companies. The interest enhancement in Norwegian offshore fields will support Hess’ long-term objective of profitably increasing its reserves and production. At the same time, by increasing its interest in Clair field, Shell is continuing with its interest in investing in long-term assets in the United Kingdom, one of Shell’s preferred areas.

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