Serica Energy finalises acquisition of Greater Buchan stake

The AIM-traded firm said completion of the transaction, first announced on 23 November, was a significant development for its wholly-owned Serica Energy UK subsidiary.

It said the partners at GBA now consisted of Serica Energy UK holding 30%, NEO Energy as the operator with a 50% interest, and JOG retaining a 20% stake.

The acquisition granted Serica Energy the opportunity to participate in the revitalisation of the Buchan field, which had been renamed ‘Buchan Horst’, alongside potential projects within the GBA, including the development of the J2 and Verbier discoveries.

Serica said the target for the start of production from Buchan was set for the fourth quarter of 2026, pending project sanction and regulatory approval.

On completion of the transaction, Serica made a cash payment of $7.5m to JOG, comprising $6.8m adjusted to reflect an economic date of 1 April 2023, as previously disclosed.

The remaining portion of the potential consideration involved a Buchan development cost carry and contingent amounts tied to specific future events, as outlined in the firm’s announcement on 23 November.

“We are pleased to have completed this transaction which creates the possibility of adding a third production hub to Serica's North Sea portfolio,” said chief executive officer Mitch Flegg.

“As a potential domestic source of oil and gas with a low level of production emissions, a provider of quality jobs for UK workers and a generator of much needed future tax revenues, Buchan is the sort of project the UK needs as part of the energy transition.”

At 1204 GMT, shares in Serica Energy were up 2.32% at 176.6p.

Reporting by Josh White for Sharecast.com.