Chevron Markets UK Central Basin Assets

US Chevron is planning to sell all its central basin North Sea oil and gas assets, it said July 4, after a strategic review. Last year, they produced an average 70,000 barrels of oil equivalent/day (boe/d), according to press reports. It operates four fields – Alba, Alder, Erskine and Captain – and plans to sell its minority stakes in others. These are Britannia, Brodgar, Callanish, Clair, Elgin/Franklin, Enochdhu and Jade.

In 2017, these non-operated interests contributed a significant proportion of Chevron’s total net daily production in the UK, averaging 26,300 boe/d, according to its website.

Chevron said it "regularly reviews its global portfolio to assess whether assets are strategic and competitive for future capital."

Partners may decide to excercise pre-emption rights; other stakes may go to privately owned upstream new-comers as well, such as Siccar Point or Chrysaor; or to end-users like Ineos, the petrochemicals company. With the oil price stabilising, the gap between buyers' and sellers' expectations might be narrower now than since the price fell, encouraging brisker trade than in the past. But there will be discussions about how to share the platform decommissioning costs. 

The CEO of offshore lobby group Oil & Gas UK, Deirdre Michie, said that while the organisation could not "comment on the commercial decisions of our members, we commend the contribution Chevron has made and continues to make to the success story of the UK North Sea. The sale, and indeed purchase of assets, is a natural part of the commercial life of the UK continental shelf (UKCS) as companies optimise their portfolios. Sale of these assets will present new opportunities for other companies who will seek to maximise recovery from mature assets on the UKCS.”