An independent oil and gas firm has raised £120million in a fresh lending package with a South African bank as it completes a deal to buy up North Sea assets
Verus Petroleum said the $150million (£118.7million) reserve-based lending (RBL) facility with Nedbank will be used to finance the deal to up its stake in the Boa oil field as well as fuel fresh acquisitions.
Verus, formerly called Bridge Energy, struck the deal to buy Maersk Oil’s 9.8% stake in Boa in October last year, adding 1,500 barrels of oil per day to its production.
The company said it aimed to add a further 1,000 barrels a day to its share of production through further development drilling on the field, which is tied back to the Alvheim FPSO on the Norwegian side of the median line.
Verus, which is backed by Norwegian private equity firm HitecVision, confirmed the deal has closed, giving it 100% of the UK portion of the field which straddles both the UK and Norwegian sides of the continental shelf.
Alan Curran, the company’s chief executive, said: “Verus is pleased to have completed the Boa transaction and to have put in place the RBL to support this and future transactions.
“The Boa acquisition is consistent with the Verus strategy of expanding our production base and cash flow.
“After two years of working through the industry downturn this milestone acquisition trebles the company’s production and, together with the RBL facility, sets us up for further deals over the coming months.”
Boa was the first acquisition for the company since the downturn. Last year it sold the Vulcan licences with a mix of both oil and gas reserves in the south North Sea to Independent Oil and Gas in a deal worth up to £5million.
It also sold licenses in the Outer Moray Firth for £1 to Cluff Resources.
Verus was formed late in 2013 when HitecVision took the company off the stock market in a transaction worth around £100million.
The group had been forged out of the 2010 merger of Norwegian Bridge Energy and Silverstone Energy. Significant shareholders included Lime Rock Partners while the company was listed on both the Olso Bors and the UK’s junior Alternative Investment Market (AIM).