Faroe Petroleum increases stakes in North Sea projects

Oil and gas explorer Faroe Petroleum has increased its share in two gas fields in the North Sea, after agreeing to acquire Roc Oil in a deal worth to $20m.

Under the agreement, Faroe will take control of Roc’s 12.5% stake in the Blane field and of the group’s 12% stake in the Enoch field.

The London-listed company said it will pay an initial $17m for the two North Sea projects, with an additional $3m to be paid if Roc Oil meets certain performance requirements.

The Blane field is already producing and pumping out an average gross production of 4,070 barrels of oil equivalent per day last year, with average operating costs of $17.7 per barrel of oil, Faroe said on Tuesday.

Meanwhile, the group said the Enoch field is currently suspended but there are plans to get it back into production during the second half of the year.

"We are very pleased to announce this acquisition, which increases our stake in the low cost, high quality and long field life Blane asset," said group chief executive Graham Stewart.

"The transaction is also very tax efficient for us, providing shelter for both past and future tax losses in the UK."

Faroe shares were down 4.47% to 69.50p at 1451 BST on Tuesday.