Ithaca Energy has completed its acquisition of Shell’s remaining 30% stake in the Cambo field, as it now looks to bring in a new venture partner ahead of investment sanction.
Completion of the acquisition this week takes Ithaca’s ownership to 100% and will provide the company with “control over the progression of the future development”, it said in a statement.
Ithaca said the deal has “minimal near-term cost exposure” and that its consideration will be payable on the either at first oil or the receipt of proceeds from any subsequent sale of a working interest in the licence – whichever arrives soonest.
It also remains subject to Ithaca proceeding with FID and/or the NSTA providing development consent.
Chief executive officer Alan Bruce said: “We are pleased to announce the completion of this acquisition, taking our ownership of Cambo to 100%.
“Following completion, we are now in a stronger position to engage with potential farm-in partners to enable the future progression of the project to Final Investment Decision.
“As the second largest undeveloped oil and gas discovery in the UK, we believe that Cambo has an important role to play in providing critical energy security to the UK, while reducing the UK’s overall emissions intensity.”
Licence deadline looms
Momentum behind the project – the second largest undeveloped oil and gas discovery in UK waters – has been slow moving since Shell announced it would not progress the controversial field in December 2021.
Despite that, executive chairman Gilad Myerson said last week it remains “really mature and is ready for sanctioning.”
Speaking during an analysts call accompanying the company’s Q3 results, Mr Myerson said Ithaca could approve the project on its own, but that this was not its preferred strategy – intending instead to bring in new co-venturers ahead of any FID.
The company says it is already “actively engaging” with potential farm-in partners.
Ithaca now faces a deadline to submit a field development plan (FDP) before the current two-year licence for the field expires on 31 March 2024 – though a potential extension is in the works.
Mr Bruce said last week that all technical work on the FDP had already been completed, with “commercial issues” being the only outstanding component.
“We’re also working with the regular on a potential extension to that milestone around field development approval given the challenges around getting the partnership group aligned. We’ll work on that over the course of the next several months,” he added.