Ithaca agrees string of deals

Ithaca Energy has agreed string of farm-out deals on a number of UK North Sea assets. 

Newly formed private-equity backed Oyster Petroleum is to take a 9% working interest in west of Shetland licences containing the Handcross prospect, P1631 and P1832 (blocks 204/14c, 204/18b and 204/19c). 

Sussex Energy is also increasing its stake in the same licences by 5%. Ithaca will remain as operator and will retain 31% interest.  

Handcross is a Palaeocene prospect in the Judd basin. An exploration well is to be drilled on the prospect using the Stena Carron drillship, with operations anticipated to start in late 2013. 

Following completion, the Handcross partners will be Ithaca (31%, operator), Edison (25%), RWE Dea (20%), Sussex Energy (15%) and Oyster Petroleum (9%).

In the third farm-out, Euroil Exploration, a subsidiary of Edison SpA, will gain a 10% working interest in licence P1820, which covers blocks 30/6b, 30/11a and 30/12d in the UK central North Sea, and contains the Isabella gas condensate prospect. 

The P1820 licence work program requires an exploration well to be drilled on the Isabella prospect by early 2015. Following completion, the Isabella partners will be Apache North Sea (50%, operator), Maersk Oil North Sea UK (30%), Ithaca (10%) and Edison (10%). 

When combined with previously announced UK farm-outs, the company is now fully carried for the forecast US$85 million cost of drilling the UK exploration well commitments transferred as part of the Valiant Petroleum acquisition and in addition will receive over US$8 million in cash from the farm-out parties.

In addition, Ithaca has entered into a further agreement with Oyster Petroleum to transfer its full 33.33% non-operated interest in UK licence P2018 for a cash sum. The RWE Dea UK-operated licence, covering west of Shetland blocks 214/24b, 214/29a and 214/30c, and containing the Ainslie prospect, was awarded in the UK 27th licensing round. 

Oyster Petroleum is a new UK West of Shetland focused exploration company backed by the Norwegian investment outfit HitecVision. 

Sussex Energy is a subsidiary of Azimuth Limited, a privately owned company with assets in the UKCS, Norway, Eire and Namibia. 

Edison is a major European energy company, with operations spanning the full energy supply chain, including oil and gas activities in Europe and Africa.

Image: The Stena Carron drillship.

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