UK-based independent oil and gas company RockRose announced that it has signed a share purchase agreement (SPA) to acquire 100% of Marathon Oil UK (MOUK) and 100% of Marathon Oil West of Shetland (MOWOS) from subsidiaries of Marathon Oil.
Image: RockRose to acquire MOUK and MOWOS. Photo: Courtesy of rawpixel on Unsplash.
RockRose is expected to pay approximately $140m to Marathon Oil for the acquisitions. The firm intends to fund the acquisition amount through existing resources and facilities.
MOUK holds 37%-40% operated interests in the Greater Brae Area fields and MOWOS holds a 28% interest in the Foinaven Field unit operated by the BP and a 47% interest in Foinaven East, respectively.
RockRose executive chairman Andrew Austin said: “This Acquisition marks a major step change in the Group’s reserves and production profile. Given the quality of these assets the Board’s view is this is a good opportunity to make the transition to the role of operator.
“We look forward to welcoming Marathon Oil UK employees, who have an excellent track record operating in the North Sea, to the RockRose team at closing.”
The company said that the present acquisition also included interests in the SAGE, Brae-Forties and WASPS infrastructure.
Once completed, the acquisition is anticipated to add approximately 35 million boe of 2P reserves to the company’s portfolio. The assets being acquired are expected to produce approximately 13,000 boepd in 2019, taking RockRose’s total net estimated production to around 24,000 boepd for the year.
The acquisition is effective from the date 1 January 2019. The MOUK and MOWOS assets and teams in Aberdeen, Peterhead and offshore will be transferred to RockRose on completion of the acquisition.
Marathon Oil chairman, president and CEO Lee Tillman said: “Today’s announcement to divest our U.K. business represents our continued commitment to portfolio management and further concentrates our portfolio on high margin, high return U.S. resource plays.
“I’d like to recognize the significant contributions of our U.K. employees – both current and past – who built and have operated the Brae Field for more than 30 years.”
RockRose is expected to assume all obligations associated with MOUK and MOWOS operations in the UK, including decommissioning liability.