REG - Ithaca Energy PLC Delek Group - DLEKG - Acquisition of JAPEX UK E&P Ltd

Ithaca EnergyAnnouncement

25/03/2025 07:15

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RNS Number : 0350C  Ithaca Energy PLC  25 March 2025

THIS ANNOUNCEMENT CONTAINS INSIDE INFORMATION

 

ITHACA ENERGY PLC

("Ithaca Energy", the "Company" or the "Group")

 

Acquisition of JAPEX UK E&P Ltd, building Ithaca Energy's interest in the
Seagull field

25 March 2025

 

Ithaca Energy, a leading UK independent production and growth company, is
pleased to announce it has signed a sale and purchase agreement to acquire the
entire issued share capital of JAPEX UK E&P Limited ("JUK") from Japan
Petroleum Exploration Co. Ltd ("the "Seller") (the "Transaction") for an
enterprise value of US$193 million based on an effective date of 1 January
2024. JUK holds a 15% working interest ("WI") in the Seagull oil field in the
UK North Sea. The Transaction, which is subject to the satisfaction of certain
conditions including regulatory approval, will increase Ithaca Energy's WI in
Seagull from 35% to 50%, equalling bp's interest as the field operator.

The Transaction is expected to add 7 mmboe of 2P reserves (as at 1 Jan 2025)
and production of approximately 4 - 4.5 kboe/d in 2025, made up of
approximately 82% liquids with the remainder gas. This Transaction is in line
with the Group's strategy to pursue value-accretive M&A, adding
high-quality assets in its core UK Continental Shelf market.

The Transaction consideration is subject to customary purchase price
adjustments, equating to an estimated payment at completion of approximately
US$140 million, assuming an illustrative 30 June 2025 closing date. The
Transaction includes JUK's material tax losses of approximately US$215 million
in both Ring Fence Corporation Tax and Supplementary Charge Tax as well as
approximately US$105 million Energy Profit Levy losses as at the effective
date of 1 January 2024, reflecting JUK's material investment in the field. The
Transaction equates to a valuation of around $10/boe (excluding tax losses).

The Seagull oil field, located in the UK Central North Sea, with over 300
mmboe in place, represents a high margin producing field, developed as a
subsea tie back to the bp-operated central processing facility (CPF) of the
Eastern Trough Area Project (ETAP). Production started in November 2023 from
the J1 well. J2 and J3 wells are now online with the fourth well, J4, due
onstream in H2 2025. The field is expected to remain in production until the
mid-2030s.

Yaniv Friedman, Executive Chairman, commented "Today's announcement regarding
the acquisition of JUK shows Ithaca Energy's growth strategy in action with a
highly accretive, easily digestible and synergistic deal that will add
incremental production for the Group, in a well-understood, high-value field."

 

The information contained within this announcement is deemed by Ithaca Energy
to constitute inside information for the purposes of Article 7 of the Market
Abuse Regulation (EU) No 596/2014 (as it forms part of UK domestic law by
virtue of the European Union (Withdrawal) Act 2018). By the publication of
this announcement via a Regulatory Information Service, this inside
information is now considered to be in the public domain. The person
responsible for making this announcement on behalf of Ithaca Energy is Julie
McAteer, General Counsel and Company Secretary.

 

Enquiries

 Ithaca Energy
 Kathryn Reid - Head of Investor Relations, Corporate Affairs &      kathryn.reid@ithacaenergy.com (mailto:kathryn.reid@ithacaenergy.com)
 Communications

 FTI Consulting (PR Advisers to Ithaca Energy)                       +44 (0)203 727 1000
 Ben Brewerton / Nick Hennis                                         ithaca@fticonsulting.com (mailto:ithaca@fticonsulting.com)

About Ithaca Energy plc

Ithaca Energy is a leading UK independent exploration and production company
focused on the UK North Sea with a strong track record of material value
creation. In recent years, the Company has been focused on growing its
portfolio of assets through both organic investment programmes and
acquisitions and has seen a period of significant M&A driven growth
centred upon two transformational acquisitions in recent years. Today, Ithaca
Energy is one of the largest independent oil and gas companies in the United
Kingdom Continental Shelf (the "UKCS"), ranking second by resources.

 

With stakes in six of the ten largest fields in the UKCS and two of UKCS's
largest pre-development fields, and with energy security currently being a key
focus of the UK Government, the Group believes it can utilise its significant
reserves and operational capabilities to play a key role in delivering
security of domestic energy supply from the UKCS.

 

Ithaca Energy serves today's needs for domestic energy through operating
sustainably. The Group achieves this by harnessing Ithaca Energy's deep
operational expertise and innovative minds to collectively challenge the norm,
continually seeking better ways to meet evolving demands.

 

Ithaca Energy's commitment to delivering attractive and sustainable returns is
supported by a well-defined emissions-reduction strategy with a target of
achieving net zero ahead of targets set out in the North Sea Transition Deal.

 

Ithaca Energy plc was admitted to trading on the London Stock Exchange (LON:
ITH) on 14 November 2022.

 

-ENDS-

 

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