British oil and gas production company Serica Energy’s subsidiary Serica Energy (UK) has signed a sale and purchase agreement (SPA) to acquire additional interests in the Bruce and Keith fields as well as the associated infrastructure in the UK North Sea.
Image: Serica Energy to increase stakes in Bruce and Keith fields. Photo courtesy of suwatpo/FreeDigitalPhotos.net.
Under the SPA, Serica Energy (UK) will acquire 16% interest in the Bruce field and 31.83% interest in the Keith field and associated infrastructure (BHP Assets) from BHP Billiton Petroleum Great Britain (BHP).
The transaction is effective from 1 January 2018, and its completion is subject to completion of the previously announced acquisition of interests in the Bruce, Keith and Rhum fields from BP.
The deal is also subject to regulatory, government and partner consents with completion targeted for 30 November 2018.
Along with the previously announced purchases from BP and Total, the latest transaction will take Serica’s ownership of the Bruce and Keith fields to 94.25% and 91.67%, respectively, post-completion.
The net 2P reserves of the BHP assets as at 1 August 2018, are estimated to amount to approximately 4mmboe.
BHP will retain liability for the costs of decommissioning facilities and wells. Serica will pay deferred consideration to BHP for 30% of BHP’s share of future decommissioning costs when due. Deferred consideration will also be payable for the realized value of oil in the Bruce pipeline at the end of field life.
Serica Energy chief executive Mitch Flegg said: “We are delighted to have agreed with BHP to acquire their stakes in Bruce and Keith and to be consolidating our ownership in the fields to 94.25% and 91.67% respectively.
“This acquisition, in addition to the previously announced transactions with BP and Total, place us in an even better position to unlock increased value from the assets and benefit from economies of scale.”
In August, Serica Energy had agreed to buy additional stakes in the Bruce and Keith fields from Total E&P UK for $20m.
Serica Energy made a deal to buy stakes in the Bruce, Keith and Rhum fields and the three bridge-linked platforms and associated subsea infrastructure from BP for £300m ($388.27m) in November last year.