EnQuest Plc (LON:ENQ) agreed to acquire 100% of the Bentley heavy oil field from Whalsay Energy Holdings in a deal worth up to US$40mln, but zero upfront payments.
The London-listed company will fund some of Whalsay’s costs and obligations, less than US$2mln, and it agrees to a schedule of conditional deferred payments tied to future revenues from the field, up to US$40mln.
Bentley is located some 15 kilometres from EnQuest’s part-owned Kraken field and its Bressay operation.
EnQuest said the acquired project offers long-term potential development opportunities and other synergies.
The transaction is conditional upon approval from regulator the UK Oil and Gas Authority along with the extension of the existing UK Oil and Gas Authority, presently due to expire on June 30.
Previously operated by Xcite Energy, the Bentley project withered as the former AIM-quoted firm failed to secure a farm-out partnership to fund the field’s construction.
It was successfully tested in 2012 and was estimated to have some 912mln barrels of oil in place.
According to its website, Whalsay had devised an alternate development strategy based on a 131mln barrel oil reserve in a core area of the field. It says the approach would deliver a commercially and economically credible development concept, with life-cycle costs pitched at around US$33 per barrel.