EnQuest To Issue Discounted Shares To Buy Magnus Oil Field
U.K.-focused oil company EnQuest is offering new discounted shares to buy out the Magnus oil field and has borrowed money against 15% of its Kraken Field as it seeks to reduce its debt pile of almost $2 billion.
EnQuest, which owns a quarter of Magnus, launched a $138 million rights issue on Sept. 7 to help it to buy the rest of the 12,000-bbl/d North Sea field from BP, sending its share price tumbling by more than 13%.
If successful, the deal will bring 60 MMbbl of reserves—or an additional 30%—to EnQuest’s portfolio and also increase its stakes in the Sullom Voe oil terminal, Ninian pipeline system and Northern Leg Gas pipeline, the company said.
The rights issue announcement came as EnQuest, which has a market value of about $590 million, reported a close to 50% jump in first-half post-tax profit to $43 million thanks to its Kraken Field boosting overall output.
EnQuest also said it had agreed to ring fence 15% of Kraken for Oz (Och-Ziff) Management in exchange for $175 million, to be paid back within five years.
First-half production of 31,000 bbl/d at Kraken was slightly below expectations, but it has since picked up to as much as 36,000 bbl/d. The company had been seeking to sell a 20% stake. The Kraken money will help EnQuest to pay back nearly $200 million of debt due next month, CEO Amjad Bseisu said.
N-Sea Kicks Off IRM Campaign In North Sea
N-Sea Offshore Ltd. is delivering subsea inspection, repair and maintenance (IRM) services in the Central and Northern North Sea for an oil and gas development and production company after landing a $39 million contract, according to a news release.
The three-year contract is utilizing N-Sea vessels and project crews for vessel-based and daughter craft diving combined with ROV operations, N-Sea said. The contract is all-inclusive and includes options for extensions.
Pre-engineering survey work for the project is already complete, the company said.
Infinity Secures Work For Subsea Tieback Project
Infinity has secured a frame agreement for engineering work and has started its first project, a fast-track subsea tieback to an existing facility, the company said in a news release.
The project will be developed over the next six months with the offshore installation expected to commence late 2019, the company said. Infinity said it will manage the delivery of flow assurance and process safety engineering for the project.
Seadrill CEO Eyes Rig Market Consolidation As Oil Prices Rise
Offshore rig owner Seadrill is prepared to make acquisitions if opportunities arise amid ongoing consolidation in the industry, the company’s CEO told Reuters.
Transocean announced in September it was buying deepwater driller Ocean Rig for $2.7 billion, the company’s second major deal this year as companies position themselves for an upturn in exploration amid rising oil prices.
“Based on the number of conversations, I believe there will be more deals. ... There is still a significant amount of fleet renewal that needs to happen among our competitors,” Seadrill CEO Anton Dibowitz told Reuters in an interview.
While Seadrill is comfortable with the current size and composition of its fleet, it also eyes consolidation, he added.
“We have a history of doing transactions, and we are certainly not going to sit on our hands,” Dibowitz said.
After emerging from U.S. Chapter 11 bankruptcy protection in July, Seadrill remains a key component of the business empire of Norwegian-born billionaire John Fredriksen, who holds a stake of about 30%.
“We have an active and involved anchor shareholder and it's certainly in our DNA,” Dibowitz said when asked about potential acquisitions.
—Staff & Reuters Reports
The acquisition of Fountain Qual Water Treatment is expected to strengthen XRI Holdings’ network of water midstream systems in the Permian Basin.
Norwegian seismic surveyor Petroleum Geo Services (PGS) expects to have “significantly” higher profitability in 2019 as demand and prices are increasing, despite lower earnings in the first quarter, the company said on April 25.
The company said production from Bakken rose 17% to 130,000 barrels of oil equivalent per day (boe/d), while output from its offshore GoM operations rose nearly 71% to 70,000 boe/d.