RCS - Ithaca Energy Inc - Acquisition of Siccar Point Energy

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07/04/2022 19:00

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RNS Number : 7153H  Ithaca Energy Inc  07 April 2022

 

Thursday 7 April 2022

 

 

Ithaca Energy Limited

 

Transformational Acquisition of Siccar Point Energy

Reinforces Ithaca as one of the leading UK North Sea E&P Operators

 

Ithaca Energy is pleased to announce that it has reached an agreement to
acquire Siccar Point Energy.

 

Reinforces Ithaca as a Leading UK North Sea E&P Operator

 

The acquisition will accelerate Ithaca's growth, positioning it as one of the
leading E&P operators in the UK North Sea through the addition of four of
the UK's largest oil and gas fields to its portfolio. The consideration of the
agreement includes an upfront payment of USD 1.1 billion and a series of
contingent payments totalling a maximum of USD 360 million (USD 300 million
linked to future developments and USD 60 million linked to short term realised
commodity prices). The Siccar Point team and Operatorship of key UK assets
will transfer to Ithaca on closing, further enhancing the Company's
established Operating capability.

 

Significant Growth Opportunities

 

The addition of the Schiehallion and Mariner fields, both currently in the top
10 UK producing fields, will not only add immediate production but also add
significant room for growth through future drilling. Also included is an
interest in the producing Jade gas field, where Ithaca is an existing partner,
offering further near-term drilling exposure. The transaction will also
include the Cambo and Rosebank fields, two of the largest undeveloped and most
strategically important discoveries in the UK North Sea.

 

The acquisition of Siccar Point's assets across the West of Shetland, Northern
North Sea and Central North Sea, will add significant production, material
growth potential, and a long-life cycle to the Company's portfolio. The
acquisition will also double Ithaca's recoverable reserves and support
production of at least 80,000 - 90,000 boe/d through the next decade, with the
potential to increase this through further portfolio opportunities.

 

Reducing Emissions

 

The assets being acquired have a lower carbon intensity than both the UKCS and
global averages. In particular, development of the fields will be undertaken
using the latest technology to reduce emissions, and operated without the need
for routine flaring or venting of hydrocarbons. This approach will mean that
the new developments will have a carbon intensity of less than half of the
average UK field.

 

This focus on emissions is in line with Ithaca's current environmental
programmes which aim to reduce CO2 output by 25% by 2025.

 

Supporting UK Energy Security and Creating Jobs

 

Cambo and Rosebank represent an opportunity for Ithaca to develop fields that
will contribute significantly to the UK's energy security.  The Cambo field
on its own is anticipated to deliver up to 170 million barrels of oil
equivalent during its 25-year operational life, materially helping to reduce
the need for the import of more carbon intensive alternatives and increasing
the UK's energy independence through the energy transition.

 

With a Final Investment Decision expected on both fields next year, they
represent a near-term opportunity to enhance the local and wider UK economy
through the creation of a significant number of employment opportunities
directly and across the supply chain.

 

Alan Bruce, CEO of Ithaca Energy, commented:

"This is a transformational deal for the Company which cements Ithaca's
position as a leading independent E&P operator in the North Sea. The
acquisition doubles our recoverable resources and means that we now have
interests in a significant portion of the largest UKCS fields. This includes
interests in two of the UK's most strategically important and near-term
developments which will enable us to play an increasing role in securing
domestic energy supply for the UK. This enlarged portfolio will underpin
production of 80-90kboe/d for the next decade, with the potential for further
growth through low-risk drilling.

 

"We firmly believe that this transaction will deliver value for all of our
stakeholders including the local community and wider UK economy. The
development of the Cambo and Rosebank fields is a huge opportunity to not only
help secure the UK's energy future for at least another quarter of a century,
but also to create thousands of direct and indirect jobs in the process. We
are excited about the future for the enlarged Ithaca, the role we will play in
the UKs energy supply, and look forward to welcoming our new colleagues from
Siccar Point."

 

Gilad Myerson, Executive Chairman of Ithaca Energy, commented:

 

"Ithaca Energy has been on a rapid growth journey over the past three years -
demonstrating our unwavering commitment to the North Sea. In that time, we
have acquired producing and development assets from Chevron, Mitsui, Marubeni,
Sumitomo (to be completed) and now Siccar Point. In addition, we have made
significant investments to develop oil and gas prospects and resources around
our infrastructure hubs - Captain (EORII), Alba (Fotla) and the Greater Stella
Area (Vorlich, Abigail).

 

"The Siccar Point team under the leadership of Jonathan Roger created an
outstanding portfolio of assets with the dedicated backing of Blackstone and
Bluewater. We are excited to become the stewards of these assets and continue
developing them in a sustainable way to support our strategy, the UK economy,
and the UKs Domestic Energy Security."

 

Jonathan Roger, CEO of Siccar Point Energy, commented:

 

"We are proud of what Siccar Point Energy has achieved as a result of the
dedication of our team and support of our sponsors, Blackstone and Bluewater,
and combining our business with Ithaca Energy is a natural step to take the
portfolio through the next stage of organic growth. Ithaca is extremely well
placed, given its material production base, to pick up the baton and unlock
the significant growth opportunities in the Siccar Point portfolio. This will
ensure the UK continues to deliver reliable UK oil and gas production for
powering homes and businesses and manufacturing essential products and
maintaining energy security during the planned energy transition. We look
forward to working with the Ithaca Energy team to support the integration of
the businesses."

 

- end -

Enquiries:

 

FTI Consulting - for all media enquiries

 

Ben Brewerton
 
ithaca@fticonsulting.com (mailto:ithaca@fticonsulting.com)

Nick
Hennis

 

 

About Ithaca Energy

 

Ithaca's strategy is centred on building a highly profitable, leading North
Sea oil and gas company.  The Company is an experienced North Sea operator
focused on the delivery of lower risk growth through the appraisal and
development of UK undeveloped discoveries and the exploitation of its UK
producing asset portfolio.  The Company was founded in 2004 and has grown
through the execution of both new field development activities and
acquisitions.

 

 

About Siccar Point Energy

 

Siccar Point Energy is a full cycle production, development and exploration
company focussed on high quality, low cost, long-life assets on the UK
Continental Shelf. They have interests in four of the largest UK assets by
remaining reserves (Schiehallion, Mariner, Cambo and Rosebank) as well as an
extensive portfolio of additional high quality material development and
exploration opportunities.

 

 

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