Faroe Petroleum Announces $17m Acquisition of Stakes in UK North Sea
Faroe Petroleum announced on Tuesday the conditional acquisition of Roc Oil (GB Holdings) Limited, which holds a 12.5006% interest in the Blane Unit in the UK North Sea and a 12.00% interest in the Enoch Unit in the UK North Sea from Roc Oil (Europe) Limited, a subsidiary of Roc Oil Company Limited.
The acquisition, for a total consideration of $17m plus a deferred payment of up to $3m depending on certain performance targets being met, is expected to complete before the year-end and is subject to UK regulatory approval and a waiver of certain conditions by the Blane Unit joint venture partners.
According to Faroe Petroleum, the Enoch field, which was closed in due to a leak at the subsea well-head, has been repaired, and it is currently planned to be brought back on production during H2 2015. The second field - Blane - was discovered in 1989, and is located on the Central Graben of the UK continental shelf, extending into the Norwegian sector. Production commenced in September 2007 from a Tertiary Palaeocene Forties sands reservoir with a structural closure.
“We are very pleased to announce this acquisition, which increases our stake in the low cost, high quality and long field life Blane asset. Blane offers significant upside potential in the form of increasing reserves and production as well as in extending field life. The transaction is also very tax efficient for us, providing shelter for both past and future tax losses in the UK” Graham Stewart, Chief Executive of Faroe Petroleum, commented in a note published on Tuesday.
The announcement confirms the growing attention to gas discoveries offshore UK.
Also on Tuesday, Subsea 7 S.A. announced the award of a subsea, umbilical, riser and flowline (SURF) contract by Maersk Oil with a value in excess of USD 150 million for the Culzean development.
‘The contract scope includes project management, engineering, procurement, construction and installation of a 22" diameter 52 km gas export pipeline connected to the Central Area Transmission System (CATS), and a 3.6 km pipe-in-pipe (10" outer pipe and 6" inner pipe) providing insulation for the transportation of the condensate to the in-field Floating, Storage and Offloading facility (FSO)’ reads the press release published by Subsea 7.
In April 2014, Faroe Petroleum announced the conditional acquisition of a 60% operated interest in the Ketch Field and a 53.1% operated interest in the Schooner Field in the UK Southern North Sea gas basin from a subsidiary of Tullow Oil.