Delek Group said that its Ithaca Energy subsidiary had reached a deal to buy the bulk of Chevron’s British North Sea oil and gas fields for $2 billion (£1.6 billion).
Under pressure from a fall in oil prices to near 14-year lows of $26 a barrel in 2016, major oil and gas companies in the North Sea have been forced to sell assets to private equity-backed investors and specialised operators. Delek said the deal, backdated to January 1 and pending regulatory approval, will quadruple Ithaca’s pro-forma production to 80,000 barrels of oil equivalent per day.
Cash coming in from the field since January 1 will probably bring the price down to around $1.65 billion on completion.
Delek said last month that it had submitted a proposal to buy the assets through Ithaca, financed mainly by reserve-based debt, after Reuters reported it was close to a deal, in another step towards its expected listing. It leaves Chevron with a heavily reduced North Sea footprint, including its 19.4 stake in the BP-operated Clair field west of Scotland’s Shetlands islands.
Under pressure from a fall in oil prices to near 14-year lows of $26 a barrel in 2016, major oil and gas companies in the North Sea have been forced to sell assets to private equity-backed investors and specialised operators. Delek said the deal, backdated to January 1 and pending regulatory approval, will quadruple Ithaca’s pro-forma production to 80,000 barrels of oil equivalent per day.
Cash coming in from the field since January 1 will probably bring the price down to around $1.65 billion on completion.
Delek said last month that it had submitted a proposal to buy the assets through Ithaca, financed mainly by reserve-based debt, after Reuters reported it was close to a deal, in another step towards its expected listing. It leaves Chevron with a heavily reduced North Sea footprint, including its 19.4 stake in the BP-operated Clair field west of Scotland’s Shetlands islands.
Source Link: www.omanobserver.om
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