Apache aiming to revive declining Beryl field in North Sea

Apache North Sea Ltd. has agreed to acquire ExxonMobil Corp.’s Mobil North Sea LLC assets for $1.75 billion.

Offshore staff

HOUSTON – Apache North Sea Ltd. has agreed to acquire ExxonMobil Corp.’s Mobil North Sea LLC assets for $1.75 billion. These include an operated interest in Beryl, one of the UK’s major North Sea production complexes, although latterly in decline.

Assets to be acquired, subject to regulatory approvals, include: 
• Operated interests in the Beryl, Nevis, Ness, Nevis South, Skene and Buckland fields 
• An operated interest in the Beryl/Brae gas pipeline and the SAGE gas plant 
• Non-operated interests in the Maclure, Scott and Telford fields 
• Benbecula (west of Shetlands) exploration acreage.

These fields have current net production of around 19,000 b/d of oil and natural gas liquids and 58 MMcf/d of natural gas, and at the end of last year total reserves estimated at 68 MMboe.

Assuming the transfer goes through by end-2011, it should increase Apache's North Sea production by 54% and proved reserves by 44%.

In 2003, Apache made its mark on the UK sector by acquired BP’s operating interest in the Forties field, another giant on the wane. Since then, the company has drilled around 100 development wells, invested $3.2 billion in the facilities, produced roughly 161 MMboe and added an estimated 171 MMboe in new reserves.

Second-quarter 2011 net production from Forties averaged 56,985 boe/d, up from 33,000 boe/d in 2Q 2003, after Apache took control.

“These major legacy assets will expand Apache's presence in the North Sea. They bring us significant remaining life, high production efficiency and quality reservoirs — the best North Sea assets we've evaluated since acquiring the Forties field in 2003," said G. Steven Farris, Apache's chairman and CEO. "There is a portfolio of low-risk exploitation projects, and we believe the complex structural setting holds reserve upside.”

Apache will take on the staff currently supporting the former Mobil North Sea LLC assets.

09/21/2011

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