Serica Energy PLC (SQSSY) said Tuesday that it is buying BP PLC's (BP) interests in three North Sea oil fields for up to 52 million pounds ($69 million) in a deal classified as a reverse takeover under Stock Exchange rules.
The independent oil-and-gas exploration and production company also said it has appointed Mitch Flegg as Chief Executive with immediate effect.
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Serica is buying a 36% interest in the Bruce field, a 34.83% interest in the Keith field and a 50% interest in the Rhum field through its subsidiary Serica U.K. The acquisition, which includes associated infrastructure, is subject to certain regulatory, government and partner consents and is expected to complete mid-2018, it said.
Serica is paying an initial consideration of GBP12.8 million with a further GBP39.1 million payable dependent on certain production and gas price thresholds being achieved.
Under the deal, BP will receive a share of pretax net cash flow from the assets of 60% in 2018, 50% in 2019 and 40% in each of 2020 and 2021, Serica said.
Serica added that based on rates for the first half of the year, net production would increase sevenfold to over 21,000 barrels of oil equivalent a day, of which over 85% will be gas.
Serica's shares have been suspended from trading as required under Stock Exchange rules given that the deal is classified as a reverse takeover. Shares were suspended at 23.25 pence.
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(END) Dow Jones Newswires
November 21, 2017 03:41 ET (08:41 GMT)