Verus raising North Sea production through Cieco transaction
Verus Petroleum has agreed to acquire ITOCHU subsidiary Cieco Exploration & Production (UK) for $400 million.
ABERDEEN, UK – Verus Petroleum has agreed to acquire ITOCHU subsidiary Cieco Exploration & Production (UK) for $400 million.
Cieco’s North Sea assets include a 23.1% interest in theWestern Isles development in the East Shetland basin, a 25.8% interest in the Hudson field in the UK central North Sea, 2% of the Brent Pipeline System, and a 1.2% interest in the Sullom Voe oil terminal on Shetland.
Verus will gain around 11,000 boe/d of production, and will fund the transaction from equity, provided by the company’s majority owned HitecVision, cash reserves and debt.
CEO Alan Curran said: “This transaction builds on our Boa oil field acquisition in 2017, and our acquisition of interests in the Alba oil field and theBabbage gas field earlier this year. The combined Alba, Babbage, and Cieco acquisitions increase our net production to around 18,000 boe/d.
“The Western Isles development includes the Harris and Barra oil fields. Production has exceeded expectations since it started in November 2017 and is currently on plateau at in excess of 40,000 boe/d, with an estimated field life of 15 years.”