Serica to Buy BP Stake in North Sea Fields, Welcome 100+ Staff
Serica UK has agreed to acquire BP plc’s interests in the Bruce, Keith and Rhum fields in the North Sea, in a deal which will see the transfer of approximately 110 BP staff to the company on completion.
The deal is expected to go through in mid-2018 and Serica currently has no plans to reduce staff numbers, according to a company spokesperson.
As part of the agreement, Serica will acquire a 36 percent interest in Bruce, a 34.83 percent interest in Keith and a 50 percent interest in Rhum (collectively the BKR assets). Subject to the completion of the acquisition, Serica will become the production operator of the BKR assets.
The Initial consideration for the acquisition is $16.9 million (GBP12.8 million), to be adjusted for working capital, with additional contingent consideration amounts of up to $51.7 million (GBP39.1 million) payable dependent on certain production and gas price thresholds being achieved.
BP will also receive a share of pre-tax net cash flow from the BKR Assets of 60 percent in 2018, 50 percent in 2019 and 40 percent in both 2020 and 2021.
Tony Craven Walker, Serica’s executive chairman, said the deal would establish Serica as a leading British independent oil and gas company with the scale, balance sheet and operating capability to prosper in the North Sea’s rapidly changing upstream oil and gas industry.
“It will diversify Serica from being a single asset to a multi-asset production company. It will also broaden our role as an operator, which will enable us to maximize performance,” said Walker in a company statement.
“We very much look forward to welcoming the extremely capable team that will be transferring to Serica from BP and combining skillsets and operational expertise,” he added.
Bernard Looney, BP Upstream chief executive, said the deal was an example of BP’s upstream strategy in action.
“Refreshing our portfolio and focusing our activity on assets which will add most value over the long-term,” said Looney in a company statement.
“We remain committed to the North Sea and continue to invest. We expect our production there to double to around 200,000 barrels equivalent a day by 2020 through new projects like Quad 204 and Clair Ridge,” he added.
“While the Bruce assets are no longer core to BP, we are confident that Serica is the right owner and operator to maximize their continuing value for both companies and for the UK,” Looney concluded.
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