EnQuest Acquires Suncor’s Stake in the Golden Eagle Area Development
EnQuest Plc has entered into an agreement with Suncor Energy UK Ltd., a wholly-owned subsidiary of Calgary-based Suncor Energy Inc., to acquire its entire non-operated interest in the Golden Eagle Area Development (GEAD), located in the UK North Sea, in exchange for a total initial consideration of US$325 million plus certain contingent payments.
EnQuest will acquire the interest by way of acquiring 100% of the shares in North Sea (Golden Eagle) Resources Ltd., a new company which will, at completion of the transaction, hold Suncor’s non-operated equity interest in the asset. Upon completion, Upon completion, EnQuest will hold a 26.69% interest in GEAD, with operator CNOOC Ltd. holding 36.54%, NEO E&P Ltd. with 31.56%, and ONE-Dyas BV holding the remaining 5.21%.
The Golden Eagle Area Development (comprising the Golden Eagle, Peregrine and Solitaire fields) is located within licenses P928 (Block 20/1N) and P300(14/26a) in the Central North Sea, approximately 110 km north-east of Aberdeen. The area primarily targets sweet, low-acid, light-oil at 36° API from two prolific reservoirs, namely Punt and Burns, at a water depth of approximately 112 meters.
Discovered in 2007, the area contains eleven producer wells and six water injection wells in the Golden Eagle field, and two producer wells and one solitaire producer well in the Peregrine field. The area has a current net average daily production of around 10 thousand barrels of oil equivalent per day (Mboe/d) net to the acquired stake.
“Upon completion, this acquisition will add immediate material production and cash flow to EnQuest and will allow us to accelerate use of our substantial tax losses. It also demonstrates our continued commitment to the UK North Sea and diversifies our existing production base,” said Amjad Bseisu, CEO of Enquest.
The transaction is subject to the satisfaction or waiver of customary closing conditions, including the approvals of joint venture partners in the Golden Eagle area and receipt of other customary regulatory and third party consents, and is expected to be completed by September 2021, with an effective date of January 1st, 2021.
JP Morgan Securities is acting as financial advisor to EnQuest on the deal.