Scottish oil and gas firm Capricorn Energy (LON:CNE) is aiming to diversify and expand its operations, targeting further opportunities in the UK North Sea.
Formerly known as Cairn Energy, the Edinburgh-based firm began scaling back its investments in the North Sea in 2021 with the sale of its interests in the Catcher and Kraken fields to Waldorf Productions for $460 million.
The company subsequently shifted focus to its operations in Egypt, leading to 120 job losses in the UK.
But in 2023, Capricorn announced plans to re-enter the UK market by acquiring Waldorf Production’s 25% stake in the Serica Energy-operated Columbus field.
As part of the deal, Waldorf agreed to make a “full and final” payment of $72.5m over stages in 2024, alongside its 25% stake in Columbus.
Waldorf default
However, earlier this month Capricorn announced that it did not receive the final settlement payment of $22.5m from Waldorf after its parent company went into administration last year.
In an operational and trading update ahead of its 2024 full-year results, Capricorn said it is continuing to evaluate its options to recover the final payment from Waldorf.
© Simon PriceCapricorn chief executive Randy Neely said outside of Egypt, the company’s priority is to “develop the scale and longevity” of its business.
“Our objective is to diversify and expand operations by leveraging our core corporate capabilities to identify, acquire and exploit the right assets in the right locations,” Neely said.
Neely said Capricorn is “currently evaluating” merger and acquisition opportunities in the UK North Sean and in the Middle East and North Africa (MENA) region.
The company is evaluating potential deals against a “strict set of strategic, financial and returns criteria”, Neely said, and the company will update the market on its efforts “when appropriate”.
Capricorn Energy
In its results to 31 December 2024, Capricorn posted revenues of $143m, against production costs of $41m.
The company recorded capital expenditure of $60m in 2024, with group net cash at $23m.
Capricorn received net cash inflows from its Egypt operations of $72m, and last week received a $50m payment from Australian operator Woodside relating to the disposal of its production sharing contract interests in Senegal.
Neely said Capricorn achieved the “top end of production guidance and a return to profitability” in 2024.
“In 2025, we will continue to focus on maximising the value from our self-funding Egyptian business unit, ensuring revenues from the assets provide the cash flow to sustain and eventually grow investment in country,” he said.
