Equinor Exits Verbier Field License in the UK North Sea
UK North Sea focused explorer Jersey Oil & Gas Plc has entered into a conditional sale and purchase agreement with a subsidiary of Norwegian major Equinor ASA to acquire its 70% operated interest in Licence P2170 (Blocks 20/5b and 21/1d) located in the Greater Buchan Area, approximately 100 km north-east of Aberdeen. The license contains the Verbier oil discovery, made in October 2017. As a result, Jersey’s interest in the license will increase to 88%, with ITOCHU Corp. subsidiary CIECO Exploration & Production (UK) Ltd. holding the remaining 12%. The consideration for the acquisition of Equinor’s 70% interest consists of a contingent payment of US$3.0 million payable upon sanctioning of a Field Development Plan (FDP) in respect of the Verbier field, and a further payment of US$5.0 million when first oil is achieved. In addition, Jersey will also make certain royalty payments on the first 35 million barrels of oil produced from the Verbier field calculated on the basis of a 70% working interest for on-block volumes. The acquisition adds 2C discovered resources of 17.5 million barrels of oil equivalent and increases Jersey’s ownership of several other high-impact exploration opportunities within the license. Equinor (then named Statoil) had farmed in to the license in 2016, but was subsequently disappointed by the results of an appraisal well drilled in early 2019.