Oil and gas operator Taqa Bratani said today it was “eager” to further expand its exploration portfolio in the North Sea after agreeing a deal with Premier Oil.
Westhill-based Taqa Bratani said it has agreed to buy a 16.6% working interest in the Sterling Resources-operated Cladhan area, one of the largest discoveries in the North Sea for years, for £34.3million, as part of the deal with Premier Oil.
It would also see it farm-in to three central North Sea blocks, one of which is due to have an exploration well drilled on it.
Both areas are close to existing infrastructure owned and operated by Taqa, opening up the potential for it to expand its operated assets.
The deal will hinge on the conclusion of Premier Oil’s purchase of Encore Oil, which owns the interest in Cladhan and the three central North Sea blocks.
Leo Koot, managing director of the subsidiary of Abu Dhabi’s National Energy Company, said: “This agreement reinforces Taqa’s commitment to the North Sea.
“Cladhan is located adjacent to our existing operations in the Northern North Sea and it is a significant development in the area.
“The farm-in, which includes access to the Coaster prospect, speaks to a further expectation of Taqa’s strategy.
“We are eager to expand our exploration portfolio to include high quality opportunities outside our existing core area. We anticipate drilling the Coaster prospect with Premier next year.”
Expectations have been rising that Cladhan, 10.8miles south-west of Taqa’s Tern platform, will be one of the biggest discoveries in the basin in years.
It was estimated last October that the discovery, 225 miles north-east of Aberdeen, could hold more than 300million barrels of oil.
Shares in Sterling Resources, operator and 39.9% owner of Cladhan, dropped 10% today. Wintershall owns 33.5% and Dyas UK 10%.
Taqa Bratani’s interest in the three central North Sea blocks, including the Coaster prospect, would be 50% on conclusion of the deal, with Premier owning the rest.
Strong oil prices, increased gas production in the UK and expanded operations at parent firm Taqa’s water and power division helped the Abu Dhabi National Oil Company boost sales and profits in the third quarter.
Announcing its results today, the firm said total sales in the three months to the end of September were £1.05billion, up 19% compared to the same period in 2010.
Pre-tax profits were £259million in the third quarter, up 123% compared to the same three months last year.
Production in the North Sea averaged 43,500 barrels of oil per day, 8% up on the same period last year aided by the Falcon field development coming on stream and the purchase of a stake and becoming operator of the Otter field, both in July.