Calendar An icon of a desk calendar. Cancel An icon of a circle with a diagonal line across. Caret An icon of a block arrow pointing to the right. Email An icon of a paper envelope. Facebook An icon of the Facebook "f" mark. Google An icon of the Google "G" mark. Linked In An icon of the Linked In "in" mark. Logout An icon representing logout. Profile An icon that resembles human head and shoulders. Telephone An icon of a traditional telephone receiver. Tick An icon of a tick mark. Is Public An icon of a human eye and eyelashes. Is Not Public An icon of a human eye and eyelashes with a diagonal line through it. Pause Icon A two-lined pause icon for stopping interactions. Quote Mark A opening quote mark. Quote Mark A closing quote mark. Arrow An icon of an arrow. Folder An icon of a paper folder. Breaking An icon of an exclamation mark on a circular background. Camera An icon of a digital camera. Caret An icon of a caret arrow. Clock An icon of a clock face. Close An icon of the an X shape. Close Icon An icon used to represent where to interact to collapse or dismiss a component Comment An icon of a speech bubble. Comments An icon of a speech bubble, denoting user comments. Ellipsis An icon of 3 horizontal dots. Envelope An icon of a paper envelope. Facebook An icon of a facebook f logo. Camera An icon of a digital camera. Home An icon of a house. Instagram An icon of the Instagram logo. LinkedIn An icon of the LinkedIn logo. Magnifying Glass An icon of a magnifying glass. Search Icon A magnifying glass icon that is used to represent the function of searching. Menu An icon of 3 horizontal lines. Hamburger Menu Icon An icon used to represent a collapsed menu. Next An icon of an arrow pointing to the right. Notice An explanation mark centred inside a circle. Previous An icon of an arrow pointing to the left. Rating An icon of a star. Tag An icon of a tag. Twitter An icon of the Twitter logo. Video Camera An icon of a video camera shape. Speech Bubble Icon A icon displaying a speech bubble WhatsApp An icon of the WhatsApp logo. Information An icon of an information logo. Plus A mathematical 'plus' symbol. Duration An icon indicating Time. Success Tick An icon of a green tick. Success Tick Timeout An icon of a greyed out success tick. Loading Spinner An icon of a loading spinner.

Union Jack buys portion of royalties for two North Sea hubs

Repsol Sinopec losses
The Claymore production hub.

Union Jack Oil has announced the purchase of rights to a portion of the royalties from two production hubs operated by Repsol Sinopec in the North Sea.

The acquisition of “royalty interests” marks the firm’s entry into the region, giving Union Jack Oil a portion of the revenues from the Claymore and Piper complexes.

Union Jack, which paid £93,730 for the stake, projects an internal rate of return of 129% on its investment.

A royalty interest refers to ownership to a percentage of the resource or revenues from a field, without contributing to operational costs.

Claymore and Piper, which produced six million barrels of oil and two billion cubic feet of gas in 2020, are subject to royalty units over 20% of their gross production.

Union Jack has acquired 2.5% of these units for an undisclosed fee from Cambridge Petroleum Royalties Limited.

There has been a long-standing royalties agreement since 1976, which Repsol Sinopec became party to when acquiring Claymore and Piper from Eni in 2013.

Repsol Sinopec has not been involved in this latest transaction.

Union Jack said this represents its first investment in the Claymore and Piper complexes, while “a second, material transaction is at an advanced stage” for later in the year

The deal also covers revenues from the Scapa oilfield, a subsea tieback to Claymore.

David Bramhill, executive chairman of Union Jack Oil said it represents a “low-risk entry strategy to the North Sea”, while generating investment returns.

He added: “The Royalty provides Union Jack with the benefits of an attractive cash flow stream and high yields from North Sea oil and gas production without the accompanying capital and operating costs associated with direct participation in the underlying oil field developments and infrastructure.

“The Royalty’s superior returns and cash flow characteristics are consistent with Union Jack’s wider strategy and objectives to invest in the UK oil and gas sector.”

Mr Bramhill added that the move contributes to Union Jack’s ambition to become a “mid-tier producer”, working alongside its onshore UK projects such as Wressle, West Newton and Biscathorpe.


Recommended for you

More from Energy Voice

Latest Posts