Serica Energy (LON:SQZ) has completed its acquisition of a 30% non-operated interest in the Greater Buchan Area (GBA) redevelopment from Jersey Oil and Gas (LON:JOG).
Serica announced its plans to farm-in to the GBA project in November last year, which covers the P2498 and P2170 licences.
The GBA covers several oil and gas accumulations around 150km north east of Aberdeen in the outer Moray Firth.
After completing the deal, Serica joins NEO Energy (50% and operator) and JOG (20%) as partners.
Serica said the transaction provides the company with the option of participating in the re-development of the Buchan field (formally re-named “Buchan Horst”) and other potential projects in the GBA, such as the development of the J2 and Verbier discoveries.
Subject to project sanction and regulatory approval, Serica said the target for first production from Buchan is Q4 2026.
On completion, Serica made a cash payment to JOG of US$7.5 million (£5.9m).
The remainder of the potential consideration is in the form of a Buchan development cost carry and contingent amounts.
Serica chief executive Mitch Flegg said: “We are pleased to have completed this transaction which creates the possibility of adding a third production hub to Serica’s North Sea portfolio.
© Supplied by NEO Energy“As a potential domestic source of oil and gas with a low level of production emissions, a provider of quality jobs for UK workers and a generator of much needed future tax revenues, Buchan is the sort of project the UK needs as part of the energy transition.”
Western Isles FPSO
Plans submitted to the North Sea Transition Authority regulator involve the re-development of Buchan based on a new production hub utilising a new floating production, storage and offloading vessel (FPSO).
The FPSO is currently operating on the UK Western Isles fields and is planned to come-off station in the second half of 2024.
NEO Energy acquired the FPSO on behalf of the Buchan joint venture firms last week on November 17.
NEO estimates total capital expenditure forecast for the Buchan redevelopment to be approximately £850-950 million.
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