Onshore News: Venture Pays £28M For New Stakes
Posted on 03.09.2004 - 02:34 EDT in OFFSHORE NEWS by ginamc
Independent oil and gas company Venture Production announced yesterday a £28million deal.
It is paying the cash to acquire interests in five UK continental shelf blocks from Marubeni Oil and Gas (UK).
This will give it the remaining equity interests in the Venture-operated Birch (35.4%), Larch (43.1%) and Sycamore (35.4%) oil-producing fields (the Trees fields) that it does not already own.
Aberdeen-based Venture will also gain a portfolio of undeveloped discoveries and exploration opportunities in the central and northern North Sea.
Thanks to increasing its Trees interests to 100%, Venture's net production is expected to rise by 4,000 barrels of oil equivalent (boe) per day, and based on latest estimates its proven and probable reserves will grow by 10.4million boe to a total of 116.3million boe.
Venture is also acquiring the remaining interest in the development of the South Sycamore field and several other discoveries and prospects within block 16/12a.
The company says the immediate cash consideration will be wholly financed from existing banking facilities.
However, because of the additional prospect inventory that has been acquired, it is actively reviewing its longer-term financing requirements and capital structure.
Chief executive Bruce Dingwall said: "With the recent successful rejuvenation of Birch and the stabilisation of production from Sycamore, the Trees area remains a key asset within Venture's business. In addition to adding significantly to current oil production and our operational flexibility, this expansion of our interest in Trees offers a range of block 16/12a growth projects in which to invest over the next several years.
"We also relish gaining exposure to a fresh development and prospect inventory as part of the package of acquired interests."
In other developments, a rig is under contract to drill a water injection well by the end of this year to support the current two Sycamore production wells.
The next phase of Venture's staged investment in Sycamore will see the development of the South Sycamore field in 2005-6.
Source: The Press & Journal