UK independent EnQuest's proposed deal with Delek Group over the sale of a stake in the Kraken development in the UK North Sea has fallen through.
EnQuest said the two parties had been unable to reach an agreement and discussions have been terminated.
The firms had signed a non-binding memorandum of understanding (MoU) over a move to farm out 20% interest in the Kraken heavy oil development in the UK North Sea.
The area is in Blocks 9/2b and 9/2c in License P1575, about 350km northeast of Aberdeen. The Kraken field is spread over 42km and is expected to hold 147 MMbbl of heavy crude oil, at about 14 API in the 2P probable reserves category.
According EnQuest, production from Kraken is expected to commence in 1H 2017, using a floating production and storage offload (FPSO) with the drilling of 25 wells: 14 for production and 11 for injection.
Earlier this year EnQuest increased its stake in Kraken to 70.5% with the acquisition, for nominal consideration, of an additional 10.5% share from First Oil, thereby increasing EnQuest’s net 2P reserves by 13 MMboe. Cairn Energy holds the remaining 29.5% stake.