Jersey Oil and Gas is on the hunt to snap up assets in the UK North Sea. The firm today confirmed it was active in nine sales processes involving more than 25 field interests.
Chief executive Andrew Benitz said: “Since the JOG team joined the company in August 2015, we have remained singularly focussed on seeking to acquire positive cashflow generating production assets within the UK Continental Shelf region of the North Sea and are continually sourcing opportunities to grow the company.
“With some current stability around the US$40+ per barrel level and with fundamentals in favour of an oil price recovery later this year, we remain excited about the company’s prospects for 2016 and our ability to secure attractive producing assets and look forward to updating shareholders on our progress in due course.”
The independent operator also revealed it was working with a major bank who is “keen to support us as a possible provider of Reserve Base Lending against production assets that the company acquires”.
The firm made a loss of £1.4million – significantly down from 2014’s £44.5million loss. Corporate overheads fell from £3.1million to £1.5million year-on-year, after staff agreed to further salary cuts.
Jersey Oil and Gas also managed to strike a number of deals with creditors. The firm renegotiated its deal with the Athena oilfield consortium and CGG Services.
A company statement said: “In return for an aggregate payment of £2million by the Company to the Athena Consortium and CGG, all of the Company’s contractual liabilities to these parties would be ring-fenced and/or expunged.
“Under the terms of these settlement agreements, all future liabilities (including decommissioning costs) relating to Athena are now to be met by the partners in the Athena Consortium, other than the company, and the company will no longer have any outstanding debt due to CGG.”
Chairman MJ Stanton added: “Although several bids have been made to date, no acquisitions have yet been consummated, due in part to the volatile oil price in the second half of 2015 which has led a number of vendors expectations remaining unrealistic.
“Nonetheless, the business strategy has never been more relevant and the continued sustained depression in the oil price is leading us to see an increasing number of opportunities as vendor expectations become more realistic or lenders force companies to dispose of non-core assets to meet their debt and banking obligations. Although it is clearly difficult to forecast a definitive date for our first acquisition, which itself will be dependent on agreeing acceptable terms with vendors, I am confident that the team we have in place, positive indications of funding support, a pipeline of potential deals and the current business environment will lead to the successful acquisition of production assets in 2016 and beyond.”
Elsewhere, the firm is disputing Total over a £1million payment relating to licence P.2032. According to Jersey, Total had a conditional agreement to pay the firm £1million in relation to the termination of its farm-in for the licence.
“Total is disputing that the conditions giving rise to the obligation to pay the company the claimed amount have been satisfied and we are taking steps to pursue recovery of this amount,” the report said.
