UK: EnQuest to Buy Suncor's Golden Eagle Area Interest for Up to $375M


UK-based oil company EnQuest has agreed to buy Canadian oil firm Suncor's entire 26.69% non-operated equity interest in the Golden Eagle area in the UK North Sea.

The area, operated by China's CNOOC, comprises the producing Golden Eagle, Peregrine, and Solitaire fields, and EnQuest will pay an initial consideration of $325 million. 

Additional contingent consideration of up to $50 million, is payable in the second half of 2023, if between July 2021 and June 2023 the Dated Brent average crude price equals or exceeds US$55/bbl, upon which US$25 million is payable, or if the Dated Brent average crude price equals or exceeds US$65/bbl, upon which US$50 million is payable. 

EnQuest said the acquisition adds immediate incremental production of c.10 kboepd, c.18 MMbbls to net 2P reserves and c.5MMbbls to net 2C resources.

The company sees significant remaining development potential for the offshore area, with anticipated field life extending into the early 2030’s. Currently, a four-well infill drilling program is ongoing, with two of the four wells onstream. Golden Eagle Platform complex - File Photo: CNOOC

The program is scheduled to conclude prior to the completion of the transaction, which is expected to take place no later than the end of the third quarter of 2021.

Furthermore, EnQuest says that a number of unsanctioned activities associated with further sub-sea and platform infill drilling, topsides water debottlenecking, and an active well intervention program are being assessed.

EnQuest Chief Executive, Amjad Bseisu, said: “We are delighted we have agreed the acquisition of a material interest in Golden Eagle, a high-quality, low-cost UK North Sea development. 

"Upon completion, this acquisition will add immediate material production and cash flow to EnQuest and will allow us to accelerate use of our substantial tax losses. It also demonstrates our continued commitment to the UK North Sea and diversifies our existing production base. The assets have a strong safety record and a lower than average CO2e emissions intensity ratio."

 “We look forward to a productive partnership with the operator, CNOOC, and our future joint venture partners, NEO Energy and ONE DYAS.”  


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