Ithaca Energy has acquired JAPEX UK (JUK) from its parent company, gaining the company’s 15% interest in the Seagull oil field.
The sale and purchase agreement will see Ithaca acquire JUK’s entire issued share capital from Japan Petroleum Exploration Co. (JAPEX) for an enterprise value of US$193 million.
The transaction, once it secures regulatory approval and is completed, will increase Ithaca Energy’s stake in the Seagull field from 35% to 50%, equalling BP’s interest as the field operator.
The transaction is expected to add 7m boe of 2P reserves and production of around 4,000-4,500 boe per day, made up of approximately 82% liquids with the remainder gas, to Ithaca’s 2025 operations.
The transaction is in line with the group’s strategy to pursue value-accretive M&A, adding high-quality assets in its core UK Continental Shelf market.
Ithaca Energy executive chairman Yaniv Friedman commented: “Today’s announcement regarding the acquisition of JUK shows Ithaca Energy’s growth strategy in action with a highly accretive, easily digestible and synergistic deal that will add incremental production for the group, in a well-understood, high-value field.”
The Seagull oil field, located in the UK Central North Sea, with over 300m boe in place, represents a high margin producing field, developed as a subsea tie back to the bp-operated central processing facility (CPF) of the Eastern Trough Area Project (ETAP).
Speaking to Energy Voice, Friedman noted: “This deal really demonstrates the range of inorganic growth opportunities that we have. Not every deal is transformational, but this is the type of asset that we like because it’s accretive to our equity holders, it adds cash flows, it increases our debt capacity and increases our dividend capacity.
“So exactly the type of thing that we would like to do more of.”
Friedman added that, while Seagull is operated by BP, Ithaca is considering becoming an operator itself in the future.
“We have the expertise and the right team to really do this efficiently,” he said.
Production started in November 2023 from the J1 well. J2 and J3 wells are now online with the fourth well, J4, due onstream in the second half of 2025. The field is expected to remain in production until the mid-2030s.
The transaction includes JUK’s material tax losses of approximately US$215m in both Ring Fence Corporation Tax and Supplementary Charge Tax as well as approximately US$105 million Energy Profit Levy losses, reflecting JUK’s material investment in the field.
The deal also marks JAPEX’s exit from the UK North Sea.
