International lenders have backed an ambitious deal to hand North Sea assets to new entrants.
North Sea newcomer Chrysaor revealed it has finalised £1.6billion worth of backing to support its acquisition of assets from Shell in a process that was “significantly over subscribed”.
Chrysaor hailed the facility was one of the largest UK North Sea reserves-based loan (RBL) financings in history
At the end of January, Chrysaor announced a £3billion deal for Shell’s interests in nine fields and a 10% stake in Schiehallion, west of Shetland.
Chrysaor will become one of the UK’s biggest independent oil and gas producers when the deal goes through later this year.
Read: Shell agrees £3bn sale of North Sea assets to Chrysaor
The RBL facility is a senior secured six-year £1.2billion facility which includes a further accordion facility of £400million.
It was fully underwritten and syndicated by a conortium of banks, BMO Capital Markets, BNP Paribas, Citi, DNB and ING.
A further 12 global financial institutions have joined the facility during the syndication process, the company added.
Chrysaor chief executive Phil Kirk said: “We are delighted to have completed the syndication of our RBL facility. I am pleased to have seen strong support from a number of leading UK and international banks as demonstrated by the significant level of oversubscription.
“Given difficult sector and financial market conditions over the past two years, the success of the syndication is an endorsement of the quality of the team and asset base being put together by Chrysaor and our equity backers.”
Chrysaor’s deal was backed by private equity fund EIG Global Energy Partners, through its Harbour Energy joint venture with Asian commodity group Noble. The deal was also underpiined with the RBL facility, which is now completed.
The deal included interests in Buzzard, Beryl, Bressay, Elgin-Franklin, J-Block, the Greater Armada cluster, Everest, Lomond and Erskine – plus a 10% stake in Schiehallion – will all be offloaded as part of the deal
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